Oral
Answers to
Questions

Northern Ireland

The Secretary of State was asked—

Devolved Government

Theresa Villiers: What steps his Department is taking to help restore devolved government in Northern Ireland.

Desmond Swayne: What steps his Department is taking to help restore devolved government in Northern Ireland.

Lindsay Hoyle: I welcome the Secretary of State for Northern Ireland to his new position.

Chris Heaton-Harris: Good morning, Mr Speaker. It is a pleasure to be here this morning in this role. It means that we will not be speaking to each other quite as much as we have done in the past, but I very much appreciate the way that you have interacted with me in my previous role; thank you, Sir.
I obviously intend to continue the excellent work of my two predecessors. I will be speaking to each of the Northern Ireland party leaders and will urge them to form an Executive as soon as possible. I know the House shares my view that Northern Ireland needs a stable, fully functioning devolved Government to deliver on the issues that matter most to people.

Theresa Villiers: My right hon. Friend will know that Northern Ireland is a great place—a wonderful part of our United Kingdom. I warmly congratulate him on his new role. I know that he will do a fantastic job.
The main barrier to the resumption of devolved power-sharing government is, of course, the Northern Ireland protocol, so will he undertake to push that legislation through as quickly as possible and use an Act of Parliament to get it through if necessary?

Chris Heaton-Harris: I thank my right hon. Friend for her good wishes. I think she was the third longest serving Secretary of State for Northern Ireland. I hope to emulate her and perhaps beat her record if I am any good at my role. I know the energy and passion that she put into it.
We are committed to resolving the problems in the protocol—ideally through negotiation, but if not, through legislation—so yes.

Desmond Swayne: But there is no prospect of restoring devolved government until the protocol has been resolved. Is that not the case?

Chris Heaton-Harris: The Executive do need to reform. That is very, very important. Whatever issues there are with the protocol, there are very important functions and services that the people of Northern Ireland need to work, so the Northern Ireland parties need to form an Executive as soon as possible. The protocol has put up barriers to trade and other things. We can fix them through negotiation, but if we cannot, we will fix them through legislation.

Claire Hanna: I welcome the Minister to his new role. We are concerned about his politics, but the SDLP will work constructively with anybody to get solutions. He will be aware of the absence of a fuel poverty strategy and that UK-wide solutions do not account for the fact that 68% of Irish homes run on oil. They are proof that Stormont caretaker Ministers either cannot or will not see Northern Ireland through the cost of living crisis. We are concerned that the only trick up the Government’s sleeve appears to be one that will alienate a majority of Northern Ireland voters and parties, but we ask the Minister to commit to working constructively with all parties, with all identities, to get us through this impasse and see the people of Northern Ireland through the winter.

Chris Heaton-Harris: I thank the hon. Lady for her question. She had some experience of working with me when I had my Foreign Office role at the beginning of this year. I would like to think that we did work constructively together. I demonstrated that I will happily work with all parties and all communities in Northern Ireland and I intend to continue in that frame as I move forward.

Lindsay Hoyle: I call the shadow Secretary of State.

Peter Kyle: I welcome the new Secretary of State to his place and pay tribute to both of the Northern Ireland Secretaries that we have had since July. I particularly pay tribute to his predecessor, the right hon. Member for North West Cambridgeshire (Shailesh Vara), and his predecessor’s predecessor, the right hon. Member for Great Yarmouth (Brandon Lewis).
Let me ask at the outset whether the Government’s position on getting Stormont up and running is unchanged. To date, we have heard that
“there is no excuse for the DUP not being back in government”,
and also:
“Unless we get an Executive we can’t help those families in Northern Ireland.”
Is that still the case?

Chris Heaton-Harris: We are clear that the protocol is a negotiation between the EU and the UK, but, yes, the position is completely unchanged.

Peter Kyle: The former Foreign Secretary stopped protocol negotiations back in February. Now that she is Prime Minister, her team has been briefing conflicting reports about her intentions. We have heard that negotiations will restart. We have heard that negotiations will not restart and that article 16 will be used instead, or that the protocol Bill will proceed with urgency,  provoking EU retaliation. This issue will have been covered in the appointment conversation that the Secretary of State had with the Prime Minister. It is imperative that he now updates and informs the House which of these will become Government policy.

Chris Heaton-Harris: I thank the hon. Gentleman for his question. I had hoped that I had answered that a tiny bit earlier. I am keen that, in sorting out the issues of the protocol, we try to negotiate a solution with the European Union. However, we do have legislation ready. We have discussed it in this House. If we do not get a negotiated solution, we will legislate.

Sammy Wilson: I welcome the Secretary of State to his position and look forward to working with him. I hope that he will be successful in doing what is necessary to get Stormont restored, namely removing the poison of the protocol. Does he understand why Stormont and the Executive could not operate while Unionists are required through the “Ministerial Code” and decisions of the Executive to implement the very agreement that they believe is destroying the Union and damaging the economy? I trust that, in his position, he will work vigorously to have the protocol removed and sensible government restored in Northern Ireland.

Chris Heaton-Harris: I thank the right hon. Gentleman for his question. The one thing that was abundantly clear when I travelled to Northern Ireland earlier this year was that the protocol was not working for all communities in Northern Ireland. Everyone had a different solution to the problems of the protocol, but the protocol was not working. I will work with everybody to try to solve those problems, and I will be urging him and his party to go back and form an Executive, because the best way forward for Northern Ireland is for it to have a functioning Executive in the future.

Sammy Wilson: Does the Secretary of State understand that this is not just a Unionist concern? While Unionists are concerned about the constitutional impact of the protocol, the economic impact of the protocol, be it the 25% duty on steel, the 14% increase in the cost of moving goods to Northern Ireland or the reduction of choice for consumers in Northern Ireland, affects everyone in Northern Ireland, whether they are Unionist, nationalist or neither.

Chris Heaton-Harris: The right hon. Gentleman is completely correct. I saw for myself that the problems caused in the supply chain to Northern Ireland affect every single person in Northern Ireland.

Northern Ireland Protocol: Exceptions

Alan Brown: What assessment he has made with Cabinet colleagues of the potential impact of clause 15 of the Northern Ireland Protocol Bill on the (a) Northern Ireland and (b) UK economy.

Gavin Newlands: What assessment he has made with Cabinet colleagues of the potential impact of clause 15 of the Northern Ireland Protocol Bill on the (a) Northern Ireland and (b) UK economy.

Chris Heaton-Harris: Clause 15 ensures that the Bill can fully meet its objectives by granting powers to make clear where additional elements of the protocol and withdrawal agreement are excluded, subject to carefully defined purposes. To ensure that that is done only if necessary to meet the Bill’s objectives, that power is limited to a list of specified purposes.

Alan Brown: With increased exports, manufacturers in Northern Ireland rank trade arrangements as the least of their post-Brexit challenges, and Office for National Statistics figures show that the protocol has actually protected Northern Irish trade. Despite those facts, the Government seem somehow beholden to the minority views of the Democratic Unionist party. Will the Secretary of State abandon the Northern Ireland Protocol Bill and work constructively with the European Union to prevent a trade war at this time of a cost of living crisis?

Chris Heaton-Harris: There is a point among all that I agree with: it is important that we work together across this House to sort out the cost of living crisis, which affects everybody, especially those in Northern Ireland. However, I humbly suggest to the hon. Gentleman that it is quite rich for the Scottish National party to try to interfere in Northern Irish business.

Gavin Newlands: Follow that! During her leadership campaign, the new Prime Minister said she was determined to deliver the Northern Ireland Protocol Bill in full—no matter the consequences, apparently. I appreciate that the Secretary of State is brand new, so I will give him a multiple-choice question. On those consequences, will the Government a) risk a trade war with the EU and its 500 million consumers; b) risk inflaming a potentially volatile situation in Northern Ireland; c) risk people’s livelihoods and perhaps even lives in pursuit of a hard Brexit that has failed already; or d) all of the above, in ploughing on anyway?

Chris Heaton-Harris: I think the hon. Gentleman missed the option of always putting the interests of Northern Ireland first, sorting out the problems of the protocol and getting a negotiated solution—and if not, legislating for one.

Bob Blackman: Does my right hon. Friend agree that it is vital for the future of the Northern Ireland economy that goods and services can flow freely from Northern Ireland to the rest of the United Kingdom and back to Northern Ireland?

Chris Heaton-Harris: I can 100% agree with my hon. Friend. He is completely right. It is important that goods and services that are available in England, Scotland and Wales are fully available in Northern Ireland and that goods and services can flow properly. The problems that the protocol has, probably inadvertently, put in place mean that that is not the case now, and we need to solve that issue.

Lindsay Hoyle: I call the SNP spokesperson, Richard Thomson.

Richard Thomson: I take this opportunity to welcome the Secretary of State; I very much look forward to working with him.
The protocol Bill is still to make its way through the House of Lords, despite opposition to it on the Opposition Benches in this House during its passage. Can the Secretary of State confirm whether it is still the preference of the UK Government to reach a negotiated settlement with the European Union over the protocol without having to apply the terms of the protocol Bill? If it is, given that there have been no substantive negotiations since February, when does the Secretary of State plan to initiate those discussions?

Chris Heaton-Harris: First, I thank the hon. Gentleman for welcoming me to my new role; I really do look forward to working with him. Secondly, yes, the new Prime Minister said at every single hustings, I believe, that the preferred option is negotiation to sort out the protocol, but the legislation is there and it will continue through its process.

Oliver Heald: May I welcome my right hon. Friend to his new duties, and ask him to use his well known diplomatic skills and his deep experience as a referee in his new responsibilities? Does he agree with me, as co-chair of the UK-EU Parliamentary Partnership Assembly, that there is obviously a landing zone for an agreement? Both sides say so. In his discussions with the political parties from Northern Ireland, can he press for and redouble efforts on discussions that yield a result in the interests of us all?

Chris Heaton-Harris: I thank my right hon. and learned Friend for his question and for the work that he does chairing that assembly. I, too, believe, and thought when I left the Foreign Office in February, that there is a fairly obvious landing zone for the negotiations, and I very much hope and believe that that is the case today.  I think that everything can be sorted out by negotiations, but we have legislation that we will use if not.

Northern Ireland Protocol

Christine Jardine: What recent discussions he has had with representatives of political parties in Northern Ireland on the Northern Ireland Protocol Bill.

Chris Heaton-Harris: I thank the hon. Lady for her question. I will be speaking to each of the Northern Ireland party leaders this week on a number of issues, including the protocol and, as I may have mentioned, will be urging them to form an Executive as soon as possible.

Christine Jardine: As the Secretary of State is probably aware, the leader of the Alliance Party of Northern Ireland has claimed that the Government have until now taken a rather differentiated approach to the parties, and only the Democratic Unionist party was consulted on the drafting of the Northern Ireland Protocol Bill. Given the crucial importance of the protocol to our future relationship with Europe, to the future of the   United Kingdom and to the people of Northern Ireland, will he do everything that he can to ensure that each party is consulted equally?

Chris Heaton-Harris: Forgive me, but I do not think that that is completely correct, because all parties were consulted during the process—but yes, I will talk to everybody as I move forward.

Cost of Living Increases

Beth Winter: What steps the Government are taking to help tackle increases in the cost of living in Northern Ireland.

Rachael Maskell: What steps the Government are taking to help tackle increases in the cost of living in Northern Ireland.

Geraint Davies: What steps the Government are taking to help tackle increases in the cost of living in Northern Ireland.

Conor Burns: The Government have taken decisive action to help tackle increases in the cost of living across the entirety of the United Kingdom, including support for the most vulnerable households in Northern Ireland, who will receive up to £1,000, including a one-off £650 cost of living payment. Yesterday, our new Prime Minister, whom we warmly welcome to office, made it clear that the Government will announce further action later this week.

Beth Winter: The Conservatives’ low-pay agenda means that public sector pay awards are insufficient, and are pushing millions of people into poverty. Health and local authority workers in Northern Ireland are balloting over poor pay awards, as is happening in Wales. Will this new Conservative Government end their predecessors’ low-pay agenda and provide the two nations with the required funding to provide an inflation-proof pay rise, which people need and deserve?

Conor Burns: I am grateful to the hon. Lady for her question, and I preface my answer by saying that I welcome the new Secretary of State for Northern Ireland, my friend, to his position. I know that he will engage constructively with everyone and with all political parties in Northern Ireland.
I was discussing the matters that the hon. Lady raised with the head of the Northern Ireland civil service, Jayne Brady, at the weekend. Northern Ireland has received the largest block grant since devolution in 1998, and as my right hon. Friend the new Prime Minister has made clear, we stand ready to make further announcements later this week. However, we also continue to urge the parties in Northern Ireland to get a reformed, devolved Executive up and running in Northern Ireland so that the people who elect politicians in Northern Ireland can hold them accountable for the decisions that impact their lives.

Rachael Maskell: A quarter of all children in Northern Ireland are living in significant poverty—the same proportion as in my constituency in York—but that is about to get worse. It is an indictment of this Government  that they have failed to protect children from the cost of living crisis and have failed to invest in their future. What fiscal steps is the Minister calling for from the new Chancellor so that every child can have a warm meal in their stomach each day and a warm home to live in?

Conor Burns: The hon. Lady is right to highlight the extent of the challenge, but as she is incredibly fair-minded I know that she will acknowledge that Northern Ireland has significant challenges that go back many generations. If, for example, we could get Northern Ireland to the average UK level of productivity, it would be worth some £16 billion to the Exchequer. If we could get the level of economic inactivity in Northern Ireland to the UK average, there would be an extra 50,000 people in work in Northern Ireland. That is the scale of the challenge that will face all Governments as they try to improve the opportunities for all communities across Northern Ireland.

Geraint Davies: Northern Ireland is poorer, it is less well, it is more dependent on public sector pay and it is going to be hit much harder by the cost of living crisis, so why do the UK Government not spend the £400 million that has been allocated but is not being spent because Stormont is not sitting directly on the people who need it most, rather than being preoccupied with cutting Northern Ireland off from the single market, which will make things even worse?

Conor Burns: The hon. Gentleman is absolutely right to highlight the scale of the challenge. My right hon. Friend the Member for Stratford-on-Avon (Nadhim Zahawi), when he was Chancellor of the Exchequer, came to Northern Ireland to meet the Communities Minister and the Economy Minister to seek ways that the UK Government could get help directly to people who need it so desperately in Northern Ireland. We are absolutely clear—the whole House will understand this, and my right hon. Friend the new Secretary of State made it clear earlier—that the protocol is a negotiation between the Government of the United Kingdom and the European Union. We have committed publicly and straightforwardly to fixing the challenges of the interpretation and implementation of the protocol, and we believe that while we crack on with that, the parties should crack on with reforming devolved government in Northern Ireland.

Lindsay Hoyle: I call the Chair of the Northern Ireland Affairs Committee.

Simon Hoare: My right hon. Friend the Minister of State will know that the cost of living will continue to be exacerbated by the absence of Stormont and a functioning Executive. Protocol issues are being prayed in aid as an inhibitor to the restoration of Stormont. He has worked his socks off over the summer to try to bring things to a helpful and meaningful conclusion. Is he in a position to update the House on the progress he has made?

Conor Burns: The Chairman of the Select Committee asks about an incredibly important point. Getting a restored devolved Government in Northern Ireland will help enormously in delivering for the people of Northern  Ireland. We absolutely acknowledge that the protocol—its interpretation and application—is the impediment to the Democratic Unionist party going back into government, and we will fix that.
My hon. Friend is correct that I have spent a very busy period over the summer engaging with the Irish and elsewhere. I would like to place on record in the House today my thanks to the former Taoiseach, Bertie Ahern, and the former Prime Minister, Sir Tony Blair, for their assistance in the work that I have done over the summer. This weekend at the British-Irish Association in Oxford, I had constructive and prolonged talks with Vice-President Šefčovič, and I am convinced that if the appetite exists, we can find a way to a negotiated solution to the Northern Ireland protocol in the interests of all the people of Northern Ireland and all the people of the United Kingdom—and in the interest of finding a new way of working in partnership with the European Union post Brexit.

Julian Smith: I welcome the new Secretary of State. I hope he has had time to savour those moments of ecstatic relief upon realising, as a former Chief Whip, that he no longer has responsibility for the Tory parliamentary party.
Northern Ireland has unique energy needs: a reliance on heating oil, different regulation, a preponderance of small businesses and very low disposable incomes. Will the Minister confirm that in tomorrow’s energy announcement, Northern Ireland will hear not only what will happen to it but when payments will start to be made?

Conor Burns: I thank my right hon. Friend for that question and I say to him that he is held in deep affection across Northern Ireland. He is right to identify Northern Ireland’s unique energy challenges, which I have seen and heard about myself on visits in recent weeks. I know that the new Prime Minister will be hearing those messages too and will want to update the House as soon as possible.
Let me use this occasion to pay tribute to the wonderful visits team in Northern Ireland, whom my right hon. Friend will remember—Nadine, Kathryn, Nicola, Helena and George. They have supported me so brilliantly on the 277 visits that I have carried out over the last 12 months as Minister of State, 107 of them to businesses.

Lindsay Hoyle: I call the shadow Minister, Tonia Antoniazzi.

Tonia Antoniazzi: Yesterday, the Resolution Foundation told the Business, Energy and Industrial Strategy Committee that there had been a disgraceful lack of discussion about the cost of living crisis in Northern Ireland. Ofgem does not exist there, so there is no price cap on energy; 68% of homes are fuelled by oil, so costs went up in February; and a non-functioning Executive means that there is no £400 support payment. Can the Minister tell us why the Government have allowed the people of Northern Ireland to suffer for longer, and how he intends to right that wrong?

Conor Burns: I have to say that that would have been an absolutely brilliant question, if the hon. Lady had not listened to any of the answers we have given so far. I  have pointed out that the former Chancellor, my right hon. Friend the Member for Stratford-on-Avon, was there talking to the Economy and Communities Ministers. We are working with every effort to try to get help directly to the people of Northern Ireland.
I have explained what we are doing in terms of the underlying economic challenges in Northern Ireland. I have not pointed out that, in addition to all that, we have made the largest block grant since devolution with £400 million on the new deal, £617 million on city deals, £730 million on Peace Plus and £2 billion through the New Decade, New Approach commitment negotiated by my right hon. Friend the Member for Skipton and Ripon (Julian Smith). The Government are doing everything they can to deliver for the people of Northern Ireland, as they are for people across the entire United Kingdom.

Justice for Victims

Dan Jarvis: What assessment he has made of the potential impact of the Northern Ireland Troubles (Legacy and Reconciliation) Bill on access to justice for victims.

Chris Heaton-Harris: I thank the hon. Gentleman for his question. He will know that I am fairly new to my post so, to be honest, I have not actually made an assessment, but the Government believe that an approach to the past focused primarily on criminal justice outcomes will fail to deliver justice and information to the vast majority of those affected by the troubles. The legislation focuses on information recovery while ensuring that those who do not engage with this process remain indefinitely liable to prosecution.

Dan Jarvis: I welcome the Secretary of State to his place. During the debates on the Bill, Members from both sides of the House paid tribute to and supported the work of Chief Constable Jon Boutcher, who is conducting Operation Denton, which affects 127 families who lost loved ones in the troubles in Northern Ireland. Regardless of the passage of the Bill, I ask the Secretary of State to look at whether there is a way for that important work to continue, so that families in Northern Ireland can get the answers that they deserve.

Chris Heaton-Harris: I thank the hon. Gentleman for drawing my attention to that ongoing work. Of course, I will happily look at that work and come back to him, if I may.

Women’s Rights

Huw Merriman: What steps his Department is taking to help protect women’s rights in Northern Ireland.

Chris Heaton-Harris: I thank my hon. Friend for his question. This Government support any work undertaken in Northern Ireland to tackle issues that disproportionately affect women. In May, my predecessor made regulations that remove the barriers to ensure that women and girls in Northern Ireland have the same access to healthcare as those in the rest of the UK.

Huw Merriman: Despite the lead taken by the Government and the votes of this House, abortion services are still not being commissioned in Northern Ireland. I ask the Secretary of State to give a timeframe for when that will finally occur.

Chris Heaton-Harris: I will happily write to my hon. Friend with more details about that, but the regulations laid in May take a dual approach. On 20 May, the previous Northern Ireland Secretary wrote to the Health Minister in Northern Ireland requesting that he provide a clear and unambiguous commitment that he will comply with the regulations. There has been lots more action since, about which I will write to my hon. Friend.

Ian Paisley Jnr: On the issue of women’s rights, this week Northern Ireland’s golden girl, Lady Mary Peters, celebrated 50 years since achieving her gold medal at the Olympics. She has inspired young women such as Bethany Firth, Kate O’Connor, Ciara Mageean and a host of others to do likewise. Now that the Secretary of State is in post, what will he do to promote women into sport and encourage them with not only active support but resources for sport?

Chris Heaton-Harris: I thank the hon. Member for his question. He will know that I am a not very good but passionate sportsman in a whole host of sports, and I recognise what getting more women involved in all sorts of sports can do to benefit communities, people, their health and everything else. I will do everything I possibly can using sport as a tool to both get involved in all the communities in Northern Ireland and try to encourage more women into sport at the same time.

Lindsay Hoyle: Before we come to Prime Minister’s questions, I would like to point out that the British Sign Language interpretation of proceedings is available to watch on parliamentlive.tv.
I would also like to take this opportunity to welcome the new Prime Minister to her place—and I know she will want to ensure that any statements will be made in the House first.

Prime Minister

The Prime Minister was asked—

Engagements

Paulette Hamilton: If she will list her official engagements for Wednesday 7 September.

Elizabeth Truss: I am honoured to take my place as Prime Minister in this House and to take on responsibility at a vital time for our country. I am determined to deliver for everybody across our United Kingdom. I will work constructively with all Members of this House to tackle the challenges we face.
This morning, I had meetings with ministerial colleagues and others. In addition to my duties in this House, I shall have further such meetings later today.

Paulette Hamilton: Can I warmly welcome the Prime Minister to her place? This is her first Prime Minister’s question, and it is also mine.
In a leaked audiotape, the Prime Minister is heard saying that British workers need to put in “more graft” and that they are lacking in “skill and application”. She also wants to take away their basic workers’ rights. In my Erdington constituency, the latest figures from the Commons Library show that children in over 7,000 households are living in child poverty and that 68% of those households have working parents. So does the Prime Minister believe that thousands of working parents on low income in my community should just put in more graft?

Elizabeth Truss: I congratulate the hon. Lady on her first Prime Minister’s question. What I am determined to do as Prime Minister is to make sure we have an economy with high wages and high-skilled jobs, and the way I will achieve that is through reducing taxes on people across our country and boosting economic growth. That is the way that we will make sure we get the investment and the jobs that people deserve.

Theresa Villiers: I want to warmly congratulate my right hon. Friend on becoming the third woman Prime Minister of this great country. I wish her well with her premiership, and I am going to ask her about pubs today. A pub restaurant in my constituency of Barnet got in touch with me to say they were struggling to find an energy supplier, and the quotes they had got hold of showed that they would be paying a 600% increase in their bill to £320,000. They cannot survive that. Will she ensure her plan to tackle the energy price crisis helps businesses in the hospitality sector, which our communities value so much?

Elizabeth Truss: My right hon. Friend is absolutely right. The hospitality industry is vital, and I will make sure that our energy plan, which will help support businesses and people with the immediate price crisis, as well as making sure there are long-term supplies available, will help businesses as well as helping individual households.

Lindsay Hoyle: We now come to the Leader of the Opposition, Keir Starmer.

Keir Starmer: Thank you, Mr Speaker. May I congratulate the Prime Minister on her appointment? When she said in her leadership campaign that she was against windfall taxes, did she mean it?

Elizabeth Truss: I thank the right hon. and learned Gentleman for his welcome. I hope that we will be able to work together, particularly in areas we agree on. I know that we have had strong support from the Opposition in opposing Vladimir Putin’s appalling war in Ukraine, and I want us to continue to stand up to that appalling Russian aggression, which has led to the energy crisis we face now. I am against a windfall tax. I believe it is the wrong thing to be putting companies off investing in the United Kingdom, just when we need to be growing the economy.

Keir Starmer: I thank the Prime Minister for her answer. I ask because Treasury estimates are that the energy producers will make £170 billion in excess profits over the next two years. The Prime Minister knows that she has no choice but to back an energy price freeze, but that won’t be cheap, and the real choice—the political   choice—is who is going to pay. Is she really telling us that she is going to leave those vast excess profits on the table and make working people foot the bill for decades to come?

Elizabeth Truss: I understand that people across our country are struggling with the cost of living, and they are struggling with their energy bills. That is why I as Prime Minister will take immediate action to help people with the cost of their energy bills. I will be making an announcement to this House on that tomorrow, and giving people certainty to make sure that they are able to get through this winter, able to have the energy supplies and able to afford it. But we cannot just deal with today’s problem; we cannot just put a sticking plaster on it. What we need to do is increase our energy supplies long term. That is why we will open up more supply in the North sea, which the right hon. and learned Gentleman has opposed, and why we will build more nuclear power stations, which the Labour party did not do when it was in office. That is why we will get on with delivering the supply, as well as helping people through the winter.

Keir Starmer: I look forward to tomorrow’s statement, but the money has got to come from somewhere. The Prime Minister knows that every single pound in excess profits that she chooses not to tax is an extra pound on borrowing that working people will be forced to pay back for decades to come. More borrowing than is needed—that is the true cost of her choice to protect oil and gas profits, isn’t it?

Elizabeth Truss: The reality is that this country will not be able to tax its way to growth. The way we will grow our economy is by attracting investment, keeping taxes low, and delivering the reforms to build projects quicker—that is the way that we will create jobs and opportunities across our country.

Keir Starmer: So, Mr Speaker, the right hon. Lady’s first act as Prime Minister is to borrow more than is needed because she will not touch excess oil and gas profits. On that topic, how much would her planned corporation tax cut hand out to companies?

Elizabeth Truss: The right hon. and learned Gentleman is looking at this in the wrong way. The last time we cut corporation tax, we attracted more revenue into the Exchequer because more companies wanted to base themselves in Britain, and more companies wanted to invest in our country. If taxes are put up and raised to the same level as in France—that is what the current proposal is, which I will change as Prime Minister—that will put off investors, and it will put off those companies investing in our economy. Ultimately, that will mean fewer jobs, less growth, and fewer opportunities across our country.

Keir Starmer: It is extraordinary that the Prime Minister is not only refusing to extend the windfall tax but choosing to hand the water companies who are polluting our beaches a tax cut. She is choosing to hand the banks a tax cut. Add it all together, and companies who are already doing well are getting a £17 billion tax cut while working people pay for the cost of living crisis, stroke victims wait an hour for an ambulance and criminals walk the streets with impunity. Families and  public services need every penny that they can get. How on earth does she think that now is the right time to protect Shell’s profits and give Amazon a tax break?

Elizabeth Truss: I am on the side of people who work hard and do the right thing. That is why we will reverse the national insurance increase, and that is why we will keep corporation tax low, because ultimately we want investment right across our country. We want new jobs and new opportunities, and that is what I will deliver as Prime Minister.

Keir Starmer: The Prime Minister claims to be breaking orthodoxy, but the reality is that she is reheating George Osborne’s failed corporation tax plans, protecting oil and gas profits, and forcing working people to pay the bill. She is the fourth Tory Prime Minister in six years. The face at the top may change, but the story remains the same.
There is nothing new about the Tory fantasy of trickle-down economics and nothing new about this Tory Prime Minister who nodded through every single decision that got us into this mess and now says how terrible it is. Can she not see that there is nothing new about a Tory Prime Minister who when asked, “Who pays?” says, “It’s you—the working people of Britain”?

Elizabeth Truss: There is nothing new about a Labour leader who is calling for more tax rises. It is the same old, same old tax and spend. What I am about is reducing taxes, getting our economy growing, getting investment and getting new jobs for people right across the country.
I am afraid to say that the right hon. and learned Gentleman does not understand aspiration. He does not understand opportunity. He does not understand that people want to keep more of their own money. That is what I will deliver as Prime Minister. I will take immediate action to help people with their energy bills but also secure our long-term energy supply. I will take immediate action to ensure that we have lower taxes and grow the economy. In that way, I will ensure that we have a positive future for our country and get Britain moving.

Derek Thomas: First, may I congratulate my right hon. Friend the Prime Minister on her successful campaign to become our party leader and the Prime Minister of the United Kingdom?
It is right and proper that the Government focus their attention on rising energy costs for households across the country, but, as we have heard, businesses big and small are exposed to horrific energy price increases with no restraint provided by the domestic energy price cap and no support so far from Government. For the sake of businesses in west Cornwall and on Scilly, the jobs that they provide and the economy as a whole, what can my right hon. Friend the Prime Minister do to ease the energy costs that our businesses face?

Elizabeth Truss: My hon. Friend is right: we do need to address the issues that businesses face. The package that we will announce tomorrow will do just that.

Lindsay Hoyle: I call the leader of the SNP.

Ian Blackford: I am sure that the thoughts and prayers of everyone in the House will be with the families caught up in the terrible shooting over recess in Kyle and Lochalsh, and indeed in Liverpool. I trust that the families will be fully supported.
Let me congratulate the Prime Minister and her family on her appointment, but I am sorry to say that her reputation for straight talking is falling apart at the first PMQs. After nine questions, she has still not told us who will pay for her energy plan. Today, the public are waiting to find out the response to the economic crisis, and they want answers. Will she finally answer two very simple questions? Will she freeze energy prices at their current levels, and will that be paid for by a windfall tax—yes or no?

Elizabeth Truss: No, it will not be paid for by a windfall tax. I do not believe that we can tax our way to growth. I want to see us using more of our UK energy supply, including more oil and gas from the North sea and nuclear power in Scotland. I hope I can count on the SNP’s support for that.

Ian Blackford: On her first full day as Prime Minister, she has failed to rule out—[Interruption.]

Lindsay Hoyle: Order. Let us hear the next question.

Ian Blackford: The Prime Minister may have changed, Mr Speaker, but it is the same old Tories shouting us down.
On her first full day as Prime Minister, she has failed to rule out a Truss tax on households and businesses. Instead of targeting the profits of massive corporations with a windfall tax, the Prime Minister’s plan appears to be a decade-long raid on the bank accounts of ordinary taxpayers. These costs must not be passed on to consumers and businesses by deferring bills. The Government must announce an enhanced windfall profits tax, making sure that those oil and gas producers pay their fair share from excess profits. Does the Prime Minister understand that her first act as Prime Minister will now define her: a Truss tax that households and businesses will be paying for years to come?

Elizabeth Truss: I am not quite sure what the right hon. Gentleman’s position is, because on one hand he does not seem to want oil and gas extraction from the North sea, and on the other hand he wants them to pay more taxes. Why does he not make up his mind?

Chris Loder: May I, too, warmly welcome my right hon. Friend to her seat as Prime Minister? Scottish Power, Bulb and E.ON are just three of the many energy suppliers that say they provide 100% renewable electricity, yet constituents of mine in West Dorset are baffled that the energy regulator allows those prices to rise on a par with oil and gas. Will my right hon. Friend confirm that she is on the side of the consumer in her energy policy, which we will hear about tomorrow?

Elizabeth Truss: I certainly am on the side of the consumer. We need to ensure that we deal with all the issues in the energy market and the way that energy is regulated. I will certainly be saying more about that tomorrow.

Colum Eastwood: The Prime Minister should know by now that many people in the north of Ireland are starving and freezing in their homes. We need a tailored solution for Northern Ireland, but that is much harder to achieve because the Democratic Unionist party is refusing to form a Government at Stormont. The new Prime Minister has a choice to make: she can either be on the side of the DUP or on the side of struggling people in Northern Ireland. So whose side is she on?

Elizabeth Truss: I want to work with all parties in Northern Ireland to get the Executive and the Assembly back up and running so that we can collectively deliver for the people of Northern Ireland, but in order to do that we need to fix the issues of the Northern Ireland protocol, which has damaged the balance between the communities in Northern Ireland. I am determined to get on with doing that and I am determined to work with all parties to find that resolution.

Theresa May: May I congratulate my right hon. Friend and welcome her to her position as the third female Prime Minister of the United Kingdom? Can I ask my right hon. Friend why does she think it is that all three female Prime Ministers have been Conservatives?

Elizabeth Truss: I thank my right hon. Friend for her fantastic question, and I look forward to calling on her advice from her time in office as I start my work as Prime Minister. It is quite extraordinary, is it not, that there does not seem to be the ability in the Labour party to find a female leader, or indeed a leader who does not come from north London? [Laughter.] I do not know what the issue is.

Rushanara Ali: I, too, congratulate the Prime Minister on her appointment. Inflation is at a 40-year high; the NHS  is on its knees, with 6.6 million people waiting for treatment; thousands of victims of sexual offences and violent crime are waiting for justice—not to mention the passport delays, a summer of chaos in our airports and our beaches covered in sewage. The Prime Minister has served in every one of the Conservative Governments responsible for this mess, so why should the British public trust her to clean up the mess that she has helped create?

Elizabeth Truss: I am determined that we deal with the issues facing us as a nation. We do have problems with our energy supply, due to the appalling war being perpetrated by Putin in Ukraine. That is why I will take immediate action to deal with the energy crisis; my Chancellor will take immediate action to reduce taxes and make sure we are growing our economy; and our new Health Secretary, who is also the Deputy Prime Minister, will take immediate action to make sure that people are able to get appointments with their GP and proper NHS services.

Lindsay Hoyle: I call the Father of the House.

Peter Bottomley: All sides of the House should wish to help the Prime Minister to be successful in tackling the problems facing the country.
When I raised one of them in July with the former Prime Minister, the right hon. Member for Uxbridge and South Ruislip (Boris Johnson), he said that I could talk to the Housing Minister, but the Housing Minister retired within 17 minutes of hearing that. [Laughter.]
Will this Prime Minister look at why the Planning Inspectorate is able to overturn councils’ planned protections for green lungs?
And will she look at what is happening to the Goring Gap in relation to the A259 in the Worthing West and the Arundel and South Downs constituencies, because local councils have no role if they cannot protect what matters most to them?

Elizabeth Truss: I am a bit concerned about offering my hon. Friend a meeting with the Housing Minister, in case any ill should befall him. But my hon. Friend is right; there is not enough power in local hands at the moment. It is too easy for local councils to be overruled by the Planning Inspectorate, and that is certainly an issue that I expect my Secretary of State for Levelling Up, Housing and Communities to look at.

Hannah Bardell: According to the Prime Minister’s new Deputy Prime Minister, one of the things that qualified her most for being PM, and was one of her greatest achievements, was the reintroduction of beavers. Now, I am all for the beavers, but given her flip-flopping on Brexit and her inability to understand global affairs, how can constituents of mine, such as Waz Abbas, whose energy prices will go from £7,000 to £37,000 a year, or Broadtex in Livingston—its prices will go from £50,000 to £250,000 a month—have any faith that she can tackle the oncoming humanitarian crisis? Is she going to come out of her den in No. 10 and take real action, or is she going to be as useless and corrupt as her predecessor, who has rocketed off to somewhere in the Pacific?

Elizabeth Truss: I am determined to tackle the issues we face in energy, and I look forward to the Scottish Government playing their part by building new nuclear power stations.

Lindsay Hoyle: Order. I want a nicer Parliament and that question was not a good example. I certainly do not want the word “corrupt” being used against the new Prime Minister. [Interruption.] I am sure that the hon. Member for Livingston (Hannah Bardell) will withdraw that comment.

Hannah Bardell: Sometimes the truth hurts, but I am happy to withdraw it.

Victoria Atkins: May I warmly congratulate my right hon. Friend and welcome her to her place, but may I also wish her the very best with the heavy responsibilities that she now bears? Around 1.5 million households across the countryside rely on heating oil in order to keep their homes warm and cook their meals. They have faced price rises of around 130% in recent months and they are not part of the energy price cap. As rumours abound about what tomorrow’s statement may hold, will she confirm that those 1.5 million households—many of them in rural areas such as my constituency—will be specifically included in any mooted ideas about an energy price freeze?

Elizabeth Truss: My hon. Friend is right. Many of my constituents, too, rely on heating oil for their fuel. We need to make sure that we are looking after everybody in this very, very difficult winter that we are facing.

Martyn Day: Hon. Members may be familiar with the work of Bo’ness firm Ballantine Castings, an iron foundry in operation since the 1820s that in recent years has done much work around the parliamentary estate. Without the protection of an energy price cap, this specialist SME is witnessing unaffordable costs, with bills rising from £13,000 to £120,000 per month. Heavy energy users face a disproportionate burden and clearly need more support than other businesses. What will the PM do to protect our strategically important and energy-intensive industries?

Elizabeth Truss: I very strongly agree with the hon. Gentleman that there are strategic industries that use a lot of energy. We need to do all we can to help them become more energy-efficient, but we also need to make sure that they are able to remain competitive in the global marketplace. That is certainly something that the Secretary of State for Business, Energy and Industrial Strategy is looking at in preparing this package.

Kieran Mullan: May I congratulate the Prime Minister on her appointment and tell her that I know my constituents want her to succeed at a difficult time? Outside the immediate challenges of energy and inflation, levelling up remains a priority for them. One way to demonstrate her commitment to levelling up would be to choose a town such as Crewe to host Great British Railways. Will she ensure that levelling up is at the heart of that decision?

Elizabeth Truss: Crewe is, of course, a great railway town—my hon. Friend is absolutely right. I am not going to prejudge the decision that will be made, but what I will be doing as Prime Minister is absolutely focusing on levelling up and making sure that we are attracting the investment and growth into parts of this country that have been left behind, so that they have their fair share of opportunity.

Alex Davies-Jones: The new Prime Minister is now finally in post, but make no mistake: she does not have the support of the British public. She cannot even rely on the backing of her own MPs, and people in Pontypridd will never forget that she played a key role in a Government who failed millions, so will she now finally do the right and decent thing and call a general election?

Elizabeth Truss: As a country, we are facing a very serious crisis in energy, caused by Putin’s war in Ukraine. We are facing—[Interruption.]

Lindsay Hoyle: Order. The hon. Member for Stoke-on-Trent North (Jonathan Gullis) is getting very carried away. I know that as a former teacher he will want to show better behaviour than he is showing at the moment.

Elizabeth Truss: We are facing very serious issues as a country, partly as a result of the aftermath of covid and partly as a result of Putin’s war in Ukraine. What  the British people want is a Government who are going to sort it out, and that is what I am determined to do as Prime Minister: sort out the energy crisis, get our economy going and make sure that people can get doctors’ appointments. That is what I am focused on.

Nicholas Fletcher: I congratulate my right hon. Friend on her position as Prime Minister, but I would also like to thank her for her support for my campaign to keep Doncaster Sheffield airport open. Will she now help further by writing to South Yorkshire Mayor Oliver Coppard and Peel Holdings chairman John Whittaker to remind them of their powers, duties and responsibilities to the people of South Yorkshire and beyond? Will she use the full weight of her office on these decision makers to keep our Doncaster Sheffield airport open?

Elizabeth Truss: Regional airports, including Doncaster Sheffield airport, are a vital part of our economic growth. I will make sure that the new Secretary of State for Transport is immediately on the issue.

Anne-Marie Trevelyan: indicated assent.

Elizabeth Truss: I can tell that she is—she is already contacting people in Doncaster and Sheffield to make sure that we protect the airport and protect that vital infrastructure and connectivity that helps our economy to grow.

Helen Morgan: I, too, welcome the Prime Minister to her new post. During her leadership campaign, she said that ambulance waiting times in her rural Norfolk constituency were “appalling”, and I think that many of my constituents would echo that statement. Across Britain, waiting hours and hours for an ambulance has become normal, but rather than the Government focusing on the problem, a Conservative leadership fiasco has seen three Health Secretaries in three months. Will the Prime Minister get a grip on this grave situation, and commission the Care Quality Commission to investigate the causes of, and the solutions to, these ambulance delays before a service in crisis faces the additional pressures of an oncoming winter?

Elizabeth Truss: People should not have to wait as long as they are for ambulance services, and my new Health Secretary is immediately tackling this issue. She has already laid out her priorities, and sorting out the ambulance service is one of them.

Caroline Dinenage: May I, too, warmly welcome our new Prime Minister to her role, and indeed all her Front Benchers to theirs?
September is Childhood Cancer Awareness Month, and, as my right hon. Friend knows, cancer is still the biggest killer of children under the age of 14. Will she restate her Government’s commitment to publishing a 10-year cancer strategy, and can that strategy embed a childhood cancer mission at its very heart?

Elizabeth Truss: Cancer is a devastating disease, and it is particularly heartbreaking when children have cancer. We will certainly proceed with the strategy that  my hon. Friend has mentioned, and I know that our new Health Secretary will do all she can to help those children with cancer.

Tony Lloyd: On the theme of children, the Prime Minister will know from her time as Children’s Minister that children whose young lungs are exposed to cold and damp housing are more likely to fall seriously ill and possibly die. Child poverty has been growing during her time in different ministerial offices. Will she give a solemn pledge—with no evasion—that no child will go to bed in a cold, damp house this winter and beyond because the parents cannot afford to put the heating on?

Elizabeth Truss: This is why it is so important that we tackle the issue of energy. I will make sure that people are able to afford their energy bills, at the same time as dealing with the long-term supply issues to ensure that we are resilient in energy and never get into this position again.

Shailesh Vara: It is standard practice in the European Union that when it cannot get its own way in negotiations with the UK, it plays for time and waits for a new leader who it hopes will take a different view from his or her predecessor. For the sake of clarity, will my right hon. Friend confirm that the UK’s preferred option in respect of the Northern Ireland protocol is a negotiated settlement, but that if such a settlement is not forthcoming, we will proceed with the Northern Ireland Protocol Bill which is currently going through Parliament?

Elizabeth Truss: Let me first thank my right hon. Friend for his service as Northern Ireland Secretary. He is absolutely right: we need to resolve the issue of the Northern Ireland protocol. My preference is for a negotiated solution, but it does have to deliver all the things that we set out in the Northern Ireland Protocol Bill. What we cannot allow is for this situation to drift, because my No. 1 priority is protecting the supremacy of the Belfast/Good Friday agreement.

Rachel Hopkins: The new Prime Minister tells us that she will deliver on the NHS. Well, that is a turn-up for the books, because after 12 years of Conservatives driving our NHS into the ground, we have record waiting lists, people dying in ambulances outside A&E, and nurses using food banks. Given that the Prime Minister has served in the past three Conservative Governments on that watch, can she explain why we should trust her to deliver?

Elizabeth Truss: I do not agree with the way the hon. Lady is talking down our national health service. The fact is that our health service did brilliantly in tackling covid, in delivering the vaccine roll-out and in getting this country back on its feet, but we do face  challenges now with the backlog following covid, and that is why the new Health Secretary is going to work to address those challenges.

Jeremy Wright: I congratulate my right hon. Friend on her appointment and recognise her determination to address the many urgent and difficult challenges that face us now. Would she accept that one of those challenges is an almost entirely unregulated online space? Would she accept too that no responsible Government can avoid the need for excellent, balanced, sensible regulation in this space? Will she therefore assure me that the Online Safety Bill will come back to this House swiftly for us to consider further and amend if necessary?

Elizabeth Truss: I can assure my right hon. and learned Friend that we will be proceeding with the Online Safety Bill. There are some issues that we need to deal with. What I want to make sure is that we protect the under-18s from harm and that we also make sure free speech is allowed, so there may be some tweaks required, but certainly he is right that we need to protect people’s safety online.

Helen Hayes: The Prime Minister has been part of a Government who for the past 12 years have been systematically letting down the most vulnerable children in the country. The independent review of children’s social care, published by the Government in May, describes the system as being in need of a total reset. The Prime Minister has said that she wants to deliver. Will she make a cast-iron commitment to deliver for our country’s most vulnerable children, and publish the Government’s response to the independent review and an action plan for delivery, before the end of the year—yes or no?

Elizabeth Truss: Yes.

Andrea Leadsom: I would like to congratulate my right hon. Friend and her whole Front Bench, and wish them every success in the new Government. I would particularly like to thank my right hon. Friend for her steadfast commitment to support for the earliest years throughout the 12 years that she and I have worked together for three previous Prime Ministers. Can I ask her now to renew her commitment to rolling out “The best start for life”, to give every baby the best chance of leading a fulfilling life?

Elizabeth Truss: My right hon. Friend has done such a fantastic job championing this issue and developing the policies, and I am committed to following through on delivering for children, because we know that intervening early and helping children early is the best way to help those children to have a successful childhood and, ultimately, a fulfilled life.

Avanti West Coast

Navendu Mishra: (Urgent Question): To ask the Secretary of State for Transport to make a statement on the future of Avanti West Coast railway services.

Trudy Harrison: The current west coast franchise agreement is due to expire on 16 October. As with all contract awards, the Government will act in accordance with the Railways Act 1993 section 26(1) franchising policy statement, and a decision has yet to be taken by the Secretary of State. Given the market and the commercially sensitive nature of the outcome, further information cannot be provided at this time.
Like all operators, Avanti has used a degree of rest-day working to operate its timetable. In essence, this means that drivers have been volunteering to work the additional shifts over and above their contracted hours. The industry arrangement has been in place for many years, to the benefit of the drivers, the operators and indeed the passengers. Avanti has a rest-day working arrangement that remains in place with the ASLEF union, which represents about 95% of the drivers.
However, on 30 July this year Avanti experienced an unprecedented, immediate and near total cessation of drivers volunteering to work passenger trains on their rest days. This left Avanti unable to resource its timetable and, in the immediate term, resulted in significant short-notice cancellations. Avanti has reduced its timetable in response to the withdrawal of rest-day working. Reducing the timetable provided better certainty and reliability for passengers as it reduced the number of short-notice cancellations.
The Department continues to work closely with Avanti to monitor performance, while Avanti continues to review the demand data and the position regarding train crew availability to inform options to reliably increase services. An increase in services between Manchester and London remains an absolute priority and Avanti will continue to look for opportunities to support passengers and businesses along the route.

Navendu Mishra: I am grateful to you, Mr Speaker, for granting this urgent question. It is disappointing that the Secretary of State is not here, as this issue impacts millions of people in our constituencies.
Many of us saw the chaos at Manchester Piccadilly, London Euston and several other stations over the summer as Avanti West Coast slashed its timetables and suspended ticket sales at short notice, cutting key towns and cities off from each other. Now, in September, the problem has persisted and the chaos continues to blight the lives of thousands of people not only in my constituency but across the north-west of England and other parts of the UK. Avanti says that this has been caused by “unofficial strike action” and
“the current industrial relations climate”—
phrases that serve only to abdicate management responsibility for ensuring that the trains are properly staffed.
ASLEF and National Union of Rail, Maritime and Transport Workers members across the country have indeed recently been on strike in defence of their pay,  terms and conditions—I pay tribute to those members for doing so—but their strike action has no bearing on the fact that Avanti has a business model that expects train drivers to work their rest days as a way of maintaining the service, rather than having sufficient staffing levels.
We know that there have been underlying problems at Avanti for a long time. Figures from the Office of Rail and Road for the first three months of the year show that Avanti’s performance was already behind that of other franchises, such as those on the great western and east coast main lines. The company was paid £17 million in performance and management fees from the public purse in just two years, including for “operational performance”, “customer experience” and
“acting as a good and efficient operator”.
Anyone who has been on Avanti trains knows that that is absolutely untrue.
Now, customers are unable to purchase return tickets when seats for one leg have not been released, forcing people to buy two singles or open returns at greater cost; there continues to be a lack of clarity and certainty around the release of tickets; and many outlets still say “sold out”, leading people to believe there are no tickets left. My constituents, and all those who use this vital service, need and deserve clarity. We have seen poorer performance, with the threat of the closure of ticket offices, yet higher fares. It simply does not add up.
The previous Prime Minister and his Government preached levelling up, but by failing to address this crisis the Government are causing huge economic damage to Stockport, Greater Manchester and other areas across the north. As cleaners, guards, drivers and other rail staff work hard to provide a good service, the company and its management continually let the public down.
Did the former Secretary of State, the right hon. Member for Welwyn Hatfield (Grant Shapps), approve the decision to cut Avanti’s timetable? Could the Minister tell the House who is incurring the revenue loss following the cuts to Avanti’s timetable—the train operator of the taxpayer? When will the Department for Transport come up with a proper plan to end this chaos so that the route is properly up and running again? Rail passengers deserve much better.
I am very grateful to you, Mr Speaker—thank you.

Lindsay Hoyle: And so you should be!

Trudy Harrison: The hon. Gentleman raised a number of points. I completely understand the frustration and disappointment, but more than anything the need to give passengers the confidence in our rail sector to know that their train services will be safe, affordable and reliable.
This is a long-standing challenge. As I have already set out, the rest-day working agreement has been in place for many years, but it is a way of working that can no longer continue in a modern-day rail service. Part of the challenge is with recruitment and retention, which is why we are working to improve the gender balance among drivers, which is woefully low, and to improve the age diversity of drivers. When the average age is 51 years and the average age of retirement is 59, we clearly have a problem with retention. That is where we are focusing our efforts, in partnership with Avanti and all train operators.

Lindsay Hoyle: I call the Chair of the Select Committee, Huw Merriman.

Huw Merriman: I am grateful to you for granting this urgent question, Mr Speaker. At the heart of this are the passengers who are losing out yet again, and I absolutely agree with the Minister that we cannot run the rail system in such an antiquated fashion, with train operators not able to fix in advance when their staff will be rostered. I hope there will be some changes on that. The transport Bill and the formation of Great British Railways will provide many of the solutions to transform the railways. Is the Bill’s Second Reading still on track to be delivered this autumn?

Trudy Harrison: Great British Railways was a manifesto promise and that will continue. We are working with the House to secure the time and support required to continue with that legislation.

Lindsay Hoyle: I call the shadow Secretary of State, Louise Haigh.

Louise Haigh: Thank you for granting this important urgent question, Mr Speaker.
Avanti West Coast’s decision to slash services on the UK’s busiest rail route has left passengers facing chaos; it has lost more than 220,000 seats per week between our major towns and cities. The damage that this shambles is doing to the regional economy and the public purse is enormous, yet, incredibly, it was signed off by the Government. Ministers have let this failing operator get away with appalling performance for far too long: the fewest trains on time; more complaints than any other operator; and a wholesale failure to train new drivers. A serving Transport Minister in the Lords has admitted that its performance is “terrible”.
Despite that, this Department has handed tens of millions of pounds of taxpayers’ money in performance and management fees, which have then been pocketed by shareholders, including—you could not make this up—a £4 million bonus for “customer performance”. What passengers need to hear today is a plan to get this vital line back on track, because those who rely on this service are tired of excuses. It is not sustainable or reasonable to continue to rely on the good will of drivers to work on their rest days, so will the Minister demand an urgent plan from the operator to restore the timetable, as she is perfectly entitled to do under the contract? Will she commit to claw back taxpayers’ money for services that have not run? Will she tell the House why, despite a contractual obligation to train new drivers, Avanti has comprehensively failed to do so? Above all, will she ask the new Secretary of State to guarantee that there will be no more reward for failure and to strip Avanti of its contract when it comes up for renewal next month? This ongoing fiasco is causing real damage to the economy, passengers and the public. The Ministers must stop washing their hands of responsibility and, finally, intervene.

Trudy Harrison: I completely agree with the shadow spokeslady on the need to modernise the workforce. People volunteering to work rest days is no longer a sustainable way to run the rail sector, and that is what we are tackling. On timetabling, however, it is surely better to provide certainty over uncertainty. The timetabling decision was made so that at least passengers could be  provided with the confidence that the trains they see on the timetable will be running—they certainly were not previously. She will know that the rewards decision is an independent decision, and in some aspects Avanti performed well and in others it certainly did not. As I am sure she will know, the decision to be taken on 16 October is a commercially sensitive one, which I will not discuss, not least because I am not the rail Minister. I have every confidence, because the Secretary of State said so yesterday evening, that she will be meeting stakeholders, including those in the rail sector, and a new rail Minister will be appointed very shortly.

Bill Cash: I congratulate my hon. Friend on her response to this urgent question. The blame lies on both sides: the unofficial strikes are completely unwarranted and are causing immense trouble for my constituents, who are given the most appalling treatment as a result of those strikes. Furthermore, Avanti itself has got to get its act together, and get it together soon. I have been using this line on the west coast for 37 years, since I first came into Parliament, and I have never seen it in such a state as it is in at the moment. Finally, as HS2 is part of this argument, I just want to say that it is a white elephant, and I hope the Prime Minister will get rid of it as soon as possible, certainly from Birmingham northwards.

Trudy Harrison: As ever, my hon. Friend makes excellent points. I wholeheartedly agree that the situation is untenable and needs to be improved. I also travel frequently—indeed, most weeks—on my journey down to London on Northern, TransPennine and Avanti services into London Euston, so I share the challenges and the pain that those undertaking journeys to Birmingham, Liverpool, Glasgow Central and Manchester are currently enduring. That is why we are working hard in the Department for Transport with our train operating companies, particularly on the matter of recruitment, diversity and retention, to ensure that we have train drivers who are trained so that we can operate a safe, affordable and reliable service in future.

Gavin Newlands: The inflammatory tone and language the outgoing Secretary of State used regarding the ongoing industrial relations dispute has been echoed by many operators, including Avanti. That is very much to be regretted, and I hope that new leadership changes this.
Reports last week suggested that Avanti was being considered for a long-term contract award. Is there any truth to those reports, and what discussions are taking place about using the operator of last resort to take over services? Avanti paid out £11 million in dividends to shareholders last year, 30% of which went to the Italian state-owned operator Trenitalia. It is a clear sign of the failure of privatised rail operators when profits are being used to subsidise public transport in Italy, rather than the UK, so what discussions are being had with the Scottish Government about the situation at Avanti and, more broadly, how Scotland was able to nationalise our franchise and how DfT can learn from that process?
A quarter of TransPennine routes are also being suspended next week, in addition to the Avanti crisis. This is becoming a critical situation for Scotland and the north of England. Where does that leave the integrated  rail plan? Lastly, what assessment have the Government made of the economic impact on the north of England and Scotland of Avanti and TransPennine scrapping their services?

Trudy Harrison: I understand the challenges, particularly on that Glasgow Central train, which I travel on as  well. All options are on the table for the discussions on 16 October as to how we will proceed, but information about those discussions is commercially sensitive at the moment.

Chris Loder: I thank my hon. Friend for her statement to the House. Given that ASLEF, the train drivers’ union, has pumped in a quarter of a million pounds to the Labour party, does she also call on Opposition Members to condemn these strikes? Those who have a lot to say should make clear their other interests, which I am not sure they have done so far.

Trudy Harrison: My hon. Friend speaks from experience and makes an excellent point. I think all of us across this House want the same thing: for passengers to be sure that they can enjoy a safe, affordable and reliable train service. As to how we are moving forward, when 95% of train drivers are represented by ASLEF and the remaining train drivers are predominantly represented by the National Union of Rail, Maritime and Transport Workers, any of us in this House with communication channels open to those unions could make the point that the way we will have a sustainable rail sector in future, with more passengers travelling by train, is for those passengers to be confident that those trains will be driven, whether or not it is a rest day.

Maria Eagle: The Minister said that she would prefer passengers to have certainty, rather than uncertainty. I think we would all agree, but the only certainty for passengers at the moment is that they still cannot book a seat on Avanti services on virtually any weekend between now and November. When will the Government demand a legally binding plan—as they are entitled to do under the contract—to restore the timetable, and when will that proper timetable be restored?

Trudy Harrison: I understand the challenge, but however we cut this cake, we need the same ingredients: we need train drivers to drive the trains. There is a finite number of qualified, trained train drivers who can drive those routes, and it takes on average two years to recruit and train a train driver. Avanti has a particular challenge because it only had the contract for 16 weeks before we, the Government, stepped in on 1 March. That is not an excuse—I am just pointing out the facts to the hon. Member for Garston and Halewood (Maria Eagle). That is what we are dealing with; that is the challenge that my Department, Avanti and, indeed, all train operators face. This challenge is not limited to just Avanti: it is affecting all train operators at the moment, which is why we are so focused on the solution.

Mark Pawsey: The service provided by Avanti on the west coast is incredibly important to my constituents in Rugby, especially as the railways are shifting towards being used more for leisure than for  business commuting. Does the Minister agree that part of the solution to the problem is to get train drivers who work in a service that operates seven days a week to work to the same terms and conditions as workers in hospitality, health and care, and elsewhere who also serve the public at weekends?

Trudy Harrison: My hon. Friend is absolutely spot on. Of course trains need to operate seven days a week, which is why the system of train drivers volunteering to work on those rest days is no longer sustainable. A 35-hour shift and volunteering to work rest days, while it has provided considerable extra income for train drivers, is no longer sustainable. That is exactly what we will tackle through the modernising workforce programme and Great British Railways.

Graham Stringer: The Minister talks about partnership with Avanti. May I suggest to her that, if she looks at it objectively, that partnership is not working, and the best thing she could do is plan to get out of it? She should sack Avanti, which is not only not running services to Manchester—it has cut those services by two thirds—but, when it eventually gets passengers on to its trains, drops them off at unpersoned stations in an unsafe position. This is not just about running services: Avanti is a dreadful company, and should not continue with this franchise.

Trudy Harrison: As I set out previously, Avanti has particular challenges that other train operating companies do not, in that it took over from Virgin and had 16 weeks before the pandemic hit. The very nature of training drivers requires close contact in a cab, which has prevented Avanti from being able to recruit and train the necessary number of drivers. Again, that is not an excuse; it is the reality of the situation.
I met with Avanti and the West Coast Partnership yesterday at the Women in Transport event, where we discussed the need to improve the current 12% level of women train drivers. When 51% of society is women, the train driving sector and the transport sector more widely are clearly missing out on incredible talent across this country. We are talking to Avanti about how they will recruit those train drivers, because whoever runs these trains, they do need to be driven.

David Jones: There is now, at best, one through train per day from Holyhead to London. Any travellers from north Wales who wish to go along the north Wales main line have to change once, or perhaps twice; in other words, the north Wales main line has been reduced to the status of a branch line. Whether that is the fault of Avanti—and I am bound to say that I do attribute a lot of blame to Avanti—it is an unacceptable state of affairs for the travelling public of north Wales, so can my hon. Friend give her best estimate as to when a decent train service will be restored to north Wales?

Trudy Harrison: My right hon. Friend is absolutely correct: the service to north Wales is unacceptable. That is why the decision that will be taken on 16 October will bear in mind how swiftly we can improve that service to north Wales and, indeed, all the other stations that Avanti West Coast connects people to.

Mick Whitley: Avanti West Coast is causing chaos for my constituents, who are still unable to book a seat on virtually any weekend between now and November. When I contacted the Secretary of State’s predecessor about this issue over the summer recess, his Department had the temerity to blame the disruption on unofficial strike action rather than on Avanti’s woeful failure to recruit new train drivers. Those claims have been rightly denounced by the rail unions as untrue. Will the Minister today commit to making a clean break with the failures of the past by refusing to reward failure and by stripping Avanti of its franchise unless immediate action is taken to restore the timetable?

Trudy Harrison: All options remain on the table, and the decision will take place on 16 October. I think I have already set out the acute challenges that Avanti faces and I make the point again that it takes, on average, two years to train a train driver. These things cannot be resolved overnight. A long-term programme is needed to recruit train drivers to the rail sector.

David Mundell: I have previously expressed my concern that, having built up an extensive timetable to Lockerbie station, which is served by both Avanti and FirstGroup, passenger confidence has been completely undermined by the unreliability of services. TransPennine is part of FirstGroup, which is also part of the Avanti partnership. I do believe that some blame lies with First and the way in which it is managing these franchises. Does my hon. Friend agree that it urgently needs to not just get rid of the managing director of Avanti, but address its part in making sure that services are available and that passengers, particularly in a rural area in Scotland such as the one that I represent, can be confident in the reliability of services?

Trudy Harrison: Absolutely. I, too, live in a rural area and recognise how important a safe, reliable and affordable rail service is for passengers, especially when they do not have other options. I reiterate that a decision will be taken on 16 October. All options remain on the table. There is no excuse for Avanti’s inability over recent years to recruit sufficient numbers of train drivers. However, we do have a finite number of train drivers in the UK, and so recruiting more train drivers must be our priority. The most important thing is to recruit more people into the transport sector. We can all play a part in that. There are fantastic careers and brilliant qualifications in the transport sector, as I learned yesterday at the women in transport event. My message to all parliamentarians is to work with me in the Department for Transport to convey the great opportunities and careers that are available in the transport sector and also for train drivers.

David Linden: I declare an interest as vice-chair of the west coast main line all-party parliamentary group and as someone who spends a huge amount of my life on the west coast main line. If we follow the logic of the Minister’s argument that some of this comes down to staffing and the workforce, would she agree that the Department for Transport and Avanti have to move away from the anti-union rhetoric that was perpetuated so often by the former Secretary  of State? We have heard today, in several contributions, Members talking nonsense about unofficial strikes. If she thinks that the workforce is the most important element here, how does that inflammatory language help the situation?

Trudy Harrison: I certainly have not used inflammatory language. My husband is a member of the GMB union and I believe that my salary contributes every month to its upkeep.
On the west coast main line, 500,000 seats are still provided every week. Yes, we have seen a dramatic reduction, but I do agree that we need to work with all partners and all stakeholders to resolve this urgent situation for the benefit of passengers, to decarbonise the transport sector, to reduce emissions, to cut the congestion on our roads and to ensure that we have a sustainable, safe, affordable and reliable train service in the future. That is common sense.

Andy Carter: I am grateful to the Minister for her update. I, too, met Avanti representatives last week. They told me that they had reduced the number of trains from Euston from nine to four an hour. My constituents are telling me that they are unable to get advance tickets more than three days before travel. Will the Minister take some practical steps with Avanti and, now that it has a core emergency timetable, ask that it release advance tickets further in advance— perhaps at least three or four days in advance of when people need to travel—so that constituents know that they can travel with some certainty?

Trudy Harrison: My hon. Friend makes a brilliant point. I will ensure that the new Secretary of State hears that suggestion and that we work with Avanti to be able to provide those advance tickets, giving passengers that certainty as soon as possible.

Cat Smith: When just 53% of Avanti trains are arriving on time, it comes as no surprise that I have been inundated with complaints. I have lost count of the number of constituents who have been in touch with me really frustrated by their experience of Avanti. They talk of trains being cancelled, trains being delayed, and seats being double booked. Does the Minister think that the £4 million bonus that Avanti got for customer satisfaction and performance would perhaps have been better spent on driver recruitment and training?

Trudy Harrison: Any performance fees that are being referred to relate to last year’s service, not this one.

Simon Fell: As my hon. Friend and constituency neighbour well knows—she often travels on the same train as me between London and Cumbria—the quality and quantity of services have dropped significantly. These short-term cancellations are really affecting our constituents. They are missing their connections with Northern, which, by the way, is experiencing similar issues on its line. Whether these problems are down to unofficial strike action or problems with Avanti and Northern management, will my hon. Friend assure me that the new Secretary of State will be getting a grip on this issue so that our constituents do not have to live with this for much longer?

Trudy Harrison: Absolutely. I understand the challenges, particularly on the Cumbrian coast line. I have spoken to passengers who have suffered the pain of having their last train cancelled. I for one would like to see that policy come to an end. That is why we have taken the difficult decision to reduce the timetable so that we can provide certainty and avoid people expecting a train to be running and then being told at the last minute that it will not run. That is in nobody’s best interests. On whether these are unofficial strikes, the reality is that, for something like 20 years, train drivers have been happy to work their rest days. The fact is that they are now no longer willing to do so, which has taken out of service around 40 of the 50 drivers who regularly work their rest days. We can all appreciate the immediate challenge that that has placed on Avanti, which, as I understand it, is the only train operating company to have endured such a harsh, urgent and immediate step by their train drivers.

Mike Amesbury: Passengers are sick and tired of delays, cancellations, reduced timetables, and an inability to book tickets in advance. We have a bizarre situation where Avanti received £4 million as a reward for customer service. It is now time for the Minister and the new Secretary of State to intervene and remove the franchise from the company and put in place a publicly owned and publicly controlled franchise.

Trudy Harrison: So the hon. Gentleman says. I am not so convinced by what he says. There have been considerable benefits from the privatisation of the train sector. We have seen a doubling of passengers and many, many improvements. Nobody is saying that the current situation is acceptable. That is why we are looking at this and why all options remain on the table, but I am not quite as convinced as he might be about the solution.

Michael Fabricant: I thank the hon. Member for Stockport (Navendu Mishra) for tabling this urgent question. Even though Avanti has a reduced timetable, it has not provided reliability. It is still cancelling trains and it still will not take advance bookings. Whether it is ASLEF and its actions, which are not helpful, or the effect of covid and many drivers’ not coming back to work, my hon. Friend the Minister is quite right to acknowledge that Avanti’s system of running its business is the main aggravator. We must put out thanks from my constituents in Lichfield, who at least are able to use London Northwestern Railway, which after a shaky start is now providing a very reliable service every hour down to London, but what steps can the Government take, perhaps in October, to ensure that the position with Avanti does not remain as it is?

Trudy Harrison: I agree with my hon. Friend that many train operators are providing a much better service than Avanti, and I am grateful that that is the case. We will learn from them and we will continue to speak to, challenge and probe Avanti about exactly how it will come to an agreement with its workers to ensure that we have sufficient train drivers to drive the trains as soon as possible. We recognise the importance of having a safe, affordable and reliable train service.

Afzal Khan: My constituent Lucy contacted me this week to express her concerns. Trains to London have been reduced to one per hour and are regularly at full capacity, yet ticket costs keep rising. Some constituents say they have been unable to accept work or cannot visit family because of Avanti’s poor service. Does the Minister agree that that is unacceptable? If so, why are the Government considering renewing Avanti West Coast’s contract in October?

Trudy Harrison: We are considering all options, and all options remain on the table. Withdrawing Avanti’s contract is one of those options, but we must bear in mind all the implications of that. As I said earlier, we can cut this cake however we want, but ultimately we need the drivers to be driving the trains. That must be the absolute priority. One service an hour is completely unacceptable.

Taiwo Owatemi: Across the west midlands and in my city of Coventry, commuters have faced a summer of nightmare travel disruptions, causing untold damage to the local economy. Commuters across Coventry deserve to be able to travel without facing delays caused by the Government’s inaction. When will the Minister finally hold the management team of Avanti West Coast to account for failing to provide an adequate service to commuters in Coventry?

Trudy Harrison: I fear I am repeating myself. I have said consistently that those conversations, that probing and that challenge are happening right now across the Department and a decision will be taken on 16 October this year.

Hywel Williams: The train service to Bangor in my constituency was never great, but now it is dire, with trains cancelled, trains late, trains packed, ticket prices sky-high and no reliable service to and from London. Visitors to north Wales are abandoning the train in Crewe and taking to their cars, and my constituents are driving all the way to London rather than taking the train. So much for Union connectivity—so much for green travel. Is it not clear to the Minister that Avanti West Coast should lose the franchise and be replaced with a public service as in other, more developed countries such as Germany?

Trudy Harrison: While I have deep sympathy with the hon. Gentleman’s constituents, and indeed with everybody who has endured the pain of an unacceptable, unreliable train service for far too long, I also want to point out that we are working with Avanti and all train operating companies, which have had a particularly difficult time during the pandemic. I agree that it is unacceptable that people should feel the need to drive all the way from north Wales to London, because that flies in the face of our decarbonisation targets, adds to congestion, increases emissions and, frankly, is not the most pleasurable way to travel across the country.
I for one thoroughly enjoy my train journey from my community down to London, and I want many more people across this country to travel by train. That is why we have taken the steps we have, not only to challenge Avanti and all train operating companies on their recruitment, their diversity, on improving the fact that only 12% of train drivers are women and the fact that  the average age is approaching the average retirement age, but to relay to the public the advantages of travelling by train, on which I am sure he can agree with me.

Bill Esterson: A number of times throughout this discussion, the Minister has agreed with hon. Members from across the House that Avanti is delivering a service that is simply not acceptable. Will she admit that her Department’s only logical step to improve that service must include removing the franchise from Avanti?

Trudy Harrison: While it is my job to answer the questions, my question to the hon. Gentleman would be: “Where are the drivers going to come from?” That is the challenge here. However we cut this cake, the ingredients are the same. We need drivers to drive the trains, and that is what we are focused on.

Patrick Grady: The Government seem to think that state ownership should not be necessary, but, as my hon. Friend the Member for Paisley and Renfrewshire North (Gavin Newlands) pointed out, much of the UK’s railways are already in state ownership—the states of Germany, the Netherlands and, in the case of Avanti West Coast, Italy. Is it not time that the Government learned lessons from Scotland and followed the Scottish Government’s example by bringing the railway operators and any profits they might make back into public ownership?

Trudy Harrison: The reality is that we, the state, are currently paying for the train service, because it is unsustainable for train operators to pay for it themselves. I will take deep interest in comparing and contrasting ScotRail with other train operating companies; if there are lessons to be learned, I welcome them. All options are on the table, and the decision will be made on 16 October about which option will best serve our passengers, who are the most important people in this discussion.

Barbara Keeley: I want to highlight to the Minister the impact of Avanti’s cuts in service to one per hour from Manchester to London, and of passengers being unable to book at weekends. A young constituent of mine who is a wheelchair user was due to travel to London next Sunday. She is nominated for a Shaw Trust Disability Power 100 list award. She has had weeks of uncertainty and now she has to travel by coach and car. There will be many more people in that situation who need accessible transport. The Minister mentioned certainty, but there is no certainty in Avanti West Coast services or with this timetable. Will she and her Secretary of State now act, and recognise that Avanti has failed in the provision of rail services and that its contract should not be renewed?

Trudy Harrison: I spoke with a member of Andy Burnham’s office yesterday at the Women in Transport event, along with Avanti and the West Coast Partnership members that were there. I have every sympathy; I am disappointed with the service and frustrated that the hon. Lady’s constituent has had to endure such a difficult journey. The solution is to have train drivers working.
Whether we call this an unofficial strike action or not, a system whereby drivers were willing to work their rest days for extra pay has worked for nigh on 20 years, and with almost immediate effect one train company, Avanti, has not been able to persuade its drivers to work their rest days, resulting in about 40 out of 50 drivers who usually work their rest days not being willing to work more than 35 hours. I think I am setting out the challenge very clearly. Whether the franchise is state owned or privately owned, the challenge remains: these trains need to be driven, safely, by people who are trained. It takes two years to train a train driver. That is the challenge.

Paula Barker: Today I think we have truly gone through the looking glass. We have heard from those on the Government Benches about unofficial strike action, but it is not unofficial, because the Trade Union Act 2016 makes sure that it is not. If Avanti thinks that it is, it has mechanisms to challenge it. The Minister has spoken about drivers working on their rest days, but the clue is in the title—it is a rest day, and there is no compulsion for a driver to do so. Does the Minister agree that the decision to award Avanti West Coast a £4 million bonus for operational performance, customer experience and,
“acting as a good and efficient operator”,
would have been better spent on training and recruiting the new drivers she keeps going on about? Is it not time that Avanti was stripped of this contract?

Trudy Harrison: I reiterate the point that the decision on those awards is independent from Government, and was based on last year’s performance data.

Andrew Gwynne: The Minister must understand that the problems at Avanti did not begin with the change to the timetable. Avanti has been a disaster for the communities on the west coast main line. It is not acceptable that we have just one train an hour from Greater Manchester to London; that we cannot book in advance; and that the cost of tickets is far more expensive than the equivalent on the east coast main line. Avanti has failed, so in October will the Minister look objectively at all the evidence and strip Avanti of this contract, because it has broken its deed and its word, which it gave to the Government when the contract was awarded?

Trudy Harrison: Of course we will look at all the evidence. One service an hour from London Euston to Manchester is completely unacceptable. I agree with that; I think that everybody agrees with that.

Justin Tomlinson: My hon. Friend the Member for City of Chester (Christian Matheson) and I are due to meet the rail Minister next week to discuss the Chester to London line, so I hope whoever the new rail Minister is will honour that meeting. We have been asking for a meeting for six months, during which time the service has gone from terrible to non-existent. When I asked the previous rail Minister why in those circumstances Avanti would be granted a new contract, I was told that it was important to do so to ensure value for taxpayers and continuity of services  for passengers. The question to the Minister is: how can we have continuity of services when we do not have any services?

Trudy Harrison: I will ensure that that meeting goes ahead as planned.

Margaret Greenwood: One of my constituents has written to me to describe the chaos that she is experiencing. She travels on Avanti west coast to London for work on a fairly frequent basis. She explains that when trains are cancelled, particularly at short notice, the other trains are really busy. On one occasion she was on such a train. It was so busy that she could not get off to make her connection and she ended up going to London when she wanted to go to a completely different part of the country. Bearing in mind that level of chaos, why are the Government even considering renewing the contract with Avanti, and is it not time to bring our railways into public ownership?

Trudy Harrison: I am not convinced that bringing the railways into public ownership at this stage in the way that the hon. Lady has described will provide the solutions that passengers are looking for, and that is why we are going to look at all the evidence when making our decision on 16 October.

Alison Thewliss: As the MP for Glasgow Central, I know that the cancellations and lack of reliability from Avanti have had an impact on business, leisure, tourism and the many events that Glasgow hosts. People have to travel for longer and they have to go through Edinburgh, for goodness’ sake, which is a huge inconvenience and imposition. There is a particular difficulty for disabled people and those travelling with children when changing trains, so can the Minister tell us exactly why we have to wait until 16 October to get this sorted? Why can she not do more now?

Trudy Harrison: Avanti’s decision to provide a reduced timetable was certainly part of the solution, although not a satisfactory one—far from it. I have said before that one train service an hour is not acceptable at all. I agree with the hon. Lady about disabled people and people travelling with children—I am a mum of four, and I remember when my girls were all under five what a challenge it was to travel by train on a good day. To endure delays and cancellations, and to be stuck on a platform with young children, or for people who are disabled, is doubly difficult. I have absolute sympathy with all rail passengers who have endured the trials and tribulations of delayed and cancelled trains. We feel the pain—I certainly feel the pain, because I am a frequent train passenger—which is why we are taking action to remedy this situation and provide passengers with confidence that they can be sure of a safe, reliable and affordable train service in future.

Tony Lloyd: The Minister has varied between apologising and criticising Avanti. The one thing that she has not mentioned is the need to tell Avanti something very clear: get round the negotiating table with ASLEF and the other unions and sort out the industrial relations problem. It is a lousy employer, and a bit of industrial peace would move the railways forward.

Trudy Harrison: Again, it is common sense. That is already happening, which is why I am not calling for it. It needs to continue, and a solution needs to be found to provide an effective rail service—that is absolute common sense.

Wera Hobhouse: Is it not absurd that the Government are pouring billions of pounds into companies owned by other countries’ Governments? Whatever the ownership of the companies, they are failing to deliver services but have been awarded multi-million-pound contracts by the Government. Avanti is supposed to run HS2. Should that really happen in the light of the catastrophic delivery failures, and will the Government look at a new operator for HS2?

Trudy Harrison: I repeat that all options are on the table. The decisions on HS2 are a bit further away. As HS2 Minister, I can say that we are having those conversations. I am certainly speaking with Avanti and visiting all phases of HS2, both in development and in construction. Those conversations are live.

Kate Green: The service is a disgrace. Does the Minister understand that there is an urgent need for a solution—not a solution in two years’ time—and that it would be quite unconscionable for this failing company to be re-awarded the franchise in October? May I just say that it is for the Government to grasp the urgency of this situation? If Avanti and no other operator can run this service, may I gently point out that the east coast main line, which was taken into public ownership, runs more efficiently and reliably, and the fares are cheaper?

Trudy Harrison: The hon. Lady makes fair points on the comparisons with other train operators, and we will that take into consideration as we make the decision on 16 October. To reiterate, that is 16 October this year, not 2024—we are not waiting two years to make a decision.

Debbie Abrahams: It is highly regrettable that the Minister has blamed workers in relation to this particular mess. May I recount a story from a constituent who is a lawyer who commutes to London? She could only get to London last week via Leeds at extra cost and extra time, which is an absolute disgrace. She said that that showed the Government’s disregard for the north. She has made a decision to stay in the north and reinvest her salary in the north, but apparently that does not matter. Is this the last-chance saloon for Avanti? Given that it is five weeks until 16 October, what will happen in the meantime? Are we going to have another five weeks of this mess?

Trudy Harrison: Personally, I would say that the north is the best place to run a business and to live. I have considerable experience, having lived all my life in the north. On what we are doing now, Network Rail and Avanti are working to resolve the ticket issues so that they can provide those advance tickets, as I have mentioned. The decision on 16 October will be significant, which is why we need to take time to consider all the options, and to understand the evidence about which will provide the best solution for passengers, because that is the absolute priority.

Seema Malhotra: My constituents, too, want to make trips for work or to visit family and friends, and they still cannot book a seat on virtually any weekend service for the next two months. News that the TransPennine Express is also reducing services seems to be yet more evidence of a managed decline of our railways under the Conservatives, so what guarantee can the Minister give the House and my constituents that, under the Government, they will have access to the services that they need, and when that will happen? The Government have known about the issues about months, so waiting again for months and months is just not good enough.

Trudy Harrison: This Government are absolutely backing the rail sector, with more than £90 billion being invested in the integrated rail service. Great British Railways will seek to address many of these challenges, not least the modernisation of the workforce, which is absolutely necessary. I have absolutely not condemned the workers for this situation, but the fact remains that workers have been willing to work on their rest days for something like 20 years and they are no longer willing to do so, certainly with Avanti. We need to find a solution to that challenge, working with the unions but also recruiting more drivers and a more diverse set of drivers, and ensuring that we have drivers who are trained to safely, affordably and reliably operate the train service we all want—particularly this Conservative Government.

Rosie Winterton: I thank the Minister for answering the urgent question.

Jagtar Singh Johal

Rosie Winterton: I understand that legal papers have been lodged in relation to the case that is the subject of the urgent question. I am content for the urgent question to be dealt with because of the seriousness of the issues concerned, but I ask all Members to exercise caution and not to discuss issues that might prejudice any later legal proceedings.

Martin Docherty: (Urgent Question): To ask the Secretary of State for Foreign, Commonwealth and Development Affairs if he will make a statement on the Government’s actions in the case of Jagtar Singh Johal.

Rehman Chishti: I am grateful to the hon. Member for asking the urgent question, and I pay tribute to his tenacious support for his constituent Mr Jagtar Singh Johal since his arrest in India in 2017. I appreciate what a difficult time this must be for Mr Johal’s family and friends. Again, I pay tribute to his Member of Parliament for all that he is doing for his constituent in these challenging circumstances.
Consular assistance to British nationals overseas is the primary public service of the Foreign, Commonwealth and Development Office and a priority for the Foreign Secretary. Since Mr Johal’s arrest over four years ago, Ministers and officials have consistently raised our concerns about his welfare and treatment directly with the Government of India. With Mr Johal’s consent, this has included raising allegations of torture and mistreatment, and his right to a fair trial. The former Prime Minister, my right hon. Friend the Member for Uxbridge and South Ruislip (Boris Johnson) raised Mr Johal’s case with Prime Minister Modi in April. The then Foreign Secretary raised Mr Johal’s case with the Indian Minister of External Affairs, Dr Jaishankar, most recently in Delhi on 31 March. Lord Ahmad of Wimbledon, the Minister of State with responsibility for south Asia and the Commonwealth, is also in regular contact with his counterparts across the Indian Government. Since 2017, Ministers and officials have raised Mr Johal’s detention on almost 100 occasions, and they will continue to do so.
In May, the UN working group on arbitrary detention published its opinion that Mr Johal is arbitrarily detained. We take this seriously, and we are committed to doing what we can to assist Mr Johal. On 9 June, the then Foreign Secretary met the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) and Mr Johal’s brother Gurpreet to discuss this matter.
In February this year, lawyers acting for Mr Johal issued a civil litigation claim against Her Majesty’s Government in the High Court. Last month, they detailed their allegations. We must let the legal process take its course, and I will therefore not comment on this matter, in line with long-established practice, as I am sure all Members will appreciate and as you, Madam Deputy Speaker, outlined before the start of the urgent question. I can assure the hon. Member for West Dunbartonshire and the House that we will continue to do all we can to support Mr Johal and his family.

Martin Docherty: I am grateful for the Minister’s words, but my constituent had his 188th pre-trial hearing suspended today because the courts in India could not make up their mind. Perhaps we should extend our consideration to him and not just to everyone else who has been mentioned so far.
Madam Deputy Speaker, you mentioned the proceedings that have been brought. I think that it should not be outwith order to say that lawyers representing my constituent submitted a motion at the Royal Courts of Justice seeking redress after compelling evidence emerged linking the United Kingdom Government directly to his arrest and torture almost five years ago.
A case study in the Investigatory Powers Commissioner’s Office annual report in March 2020, which is in the public domain and was uncovered by the human rights group Reprieve—I and the Johal family are extremely grateful for all its work—matches entirely the specific details of Jagtar’s case, with a gut-punch of an admission that he was arrested on the basis of information provided by the intelligence services of the United Kingdom of Great Britain and Northern Ireland. This information has posed a multitude of hard questions for this Government, and especially for the new Prime Minister, the former Foreign Secretary. I am sure that we will get to hear many of them from Members present today. I am hugely grateful to the many Members who have supported this case.
Like hundreds of thousands of UK citizens of Sikh ethnicity, the Singh Johal family travel to India every year, yet now they must wonder if it is safe for them to continue to do so. They must also contend with the realisation that the horror that Jagtar went through in November 2017 of being held incommunicado for 10 days, tortured and forced into signing a blank confession, the arbitrary detention that the previous Prime Minister agreed he has faced since, and his trial by media in the Indian republic were all caused directly, at least for me, by the intervention of the state that is meant to protect him. We have a family, an MP and a House of Commons who want answers on who knew what and when.
Jagtar has a UK passport. I am afraid that is the only passport that I have, and I think it is the only one that you have, Madam Deputy Speaker. On the inside page are written the words:
“Her Britannic Majesty’s Principal Secretary of State requests and requires in the name of Her Majesty all those whom it may concern to allow the bearer to pass freely without let or hindrance and to afford the bearer such assistance and protection as may be necessary.”
Of all the many questions I could ask the Minister, the one I think is most important is this: do they think that their Government have stayed true to those words in the case of Jagtar Singh Johal?

Rehman Chishti: The first point I make to the hon. Member is that the Government’s first priority is the welfare of Mr Johal. That is the first priority of the Government, as it would be the first priority of any Government with regard to British citizens anywhere around the world.
On the hon. Member’s specific point, I return to the point I made earlier—and the point that you, Madam Deputy Speaker, made at the outset—with regard to any civil litigation and to concerns on the intelligence agencies. I cannot and I will not comment on that in this  House. Since the hon. Member raised it specifically, I reiterate that Mr Johal has active civil litigation against Her Majesty’s Government on this matter. This is the issue before the court, and we must let the legal process take its course. Therefore, in line with long-established practice, I will not comment on this matter. I am sure that the hon. Member appreciates that.
Of course, the Indian Government, having listened to these proceedings, will have to take into account the views of Members of Parliament. Some 140 MPs and peers have expressed an interest in this case. Our former Prime Minister raised it with the Indian Prime Minister. Our former Foreign Secretary raised it with her counterpart, the Indian Minister of External Affairs.

Alistair Carmichael: Did they call for his release?

Rehman Chishti: I will take questions later, subject to what you say, Madam Deputy Speaker. The point I am trying to make, to bring the House together, is that this case has been raised with our counterparts at the highest level possible, and we will continue to do all we can to support Mr Johal in this particular case.

David Davis: I associate myself with every word uttered by the hon. Member for West Dunbartonshire (Martin Docherty-Hughes). Let us be clear: we cannot talk about the case, but the allegation is clear. The allegation is that the British Government were complicit in the provision of information to the Indian Government knowing that it might be used for torture and in a capital case. The point is that this is not the first time that this has happened; it has happened on numerous occasions. When my right hon. Friend the Member for Maidenhead (Mrs May) was Prime Minister, she apologised for the most famous previous case in Libya. She said:
“We are profoundly sorry for the ordeal that you both suffered and our role in it.”
That was within a few months of Mr Johal’s arrest and the Government’s potential involvement.
There is not only one civil case looking at this issue; there is another case in my name and that of the hon. Member for Barnsley Central (Dan Jarvis) to demand that the Government review, as promised, their attitude to torture and their complicity and involvement in it. I ask the Minister whether he will give an undertaking that we will now have that review to cover the Johal case and all the others that went before it, and whether he will promise this House that we will never again be complicit in the torture of any British citizen.

Rehman Chishti: My right hon. Friend’s first point was that there are allegations in this case. Absolutely: there are allegations and there is a procedure and process that they must go through to be looked at. They are going through the High Court at this time. On that basis, I will not be drawn into commenting on that. He, and every other Member of Parliament, will recognise that if there is an allegation, it has to go through a process. Therefore, there is a separation of power between the Executive, the judiciary and the legislature. That specific matter is now at the High Court, and the High Court should make a determination on it.

Rosie Winterton: I call the shadow Minister, Catherine West.

Catherine West: The allegations in recent weeks of the potential collusion of the British intelligence service in the arbitrary detention of Mr Johal are deeply worrying. It is vital that the veracity of those claims is investigated as soon as possible to find the truth.
The House will expect the Minister to be clear on whether the former Prime Minister, the right hon. Member for Uxbridge and South Ruislip (Boris Johnson), under whose watch we believe this occurred, authorised sharing this intelligence with the Indian Government when he was the Foreign Secretary. I also urge the Minister to outline whether the Government are using their contacts at the highest level of the Indian Government to press for Mr Johal’s release without further delay.
I have three further questions. First, will the Foreign Secretary, who was appointed last night, make himself available at his earliest opportunity for a meeting with the family? Secondly, since 1995, every Government have made human rights part of the dialogue when they speak to India about trade, yet the current free trade agreement does not appear to have human rights within it. Can he clarify that?
Finally, it is a worrying pattern that there are other such cases in the Foreign, Commonwealth and Development Office—for example, Morad Tahbaz, who remains languishing in an Iranian prison, or Alaa Abd El Fattah in Egypt, who liked a Facebook page. What urgent action is the FCDO taking on those cases? It must be a first principle that it is the first duty of the Government to look after every British national. The family asked today whether the new Prime Minister will show more guts than her predecessor. I think all hon. Members would like to see some backbone injected into these negotiations.

Rehman Chishti: It is a real pleasure to face the shadow Minister, and I look forward—if I am in post—to exchanging views with her on these specific points. First, she raised the actions or non-actions of the former Prime Minister with regard to this specific case. It is important, when such an accusation is made, that it is fully and thoroughly investigated and looked at. That will be done by the High Court. As I say, Mr Johal has an active civil litigation case against Her Majesty’s Government on this matter. That is an issue before the court, and we must let the legal process take its course. I therefore cannot and will not comment on this matter, in line with long-established practice, as I am sure she appreciates.
I am also sure that the hon. Lady would agree that we all in this House respect the separation of power between the Executive, the judiciary and the legislature, and, with regard to the intelligence agencies, the various checks and balances. We have the Intelligence and Security Committee, the Investigatory Powers Tribunal and the Investigatory Powers Commissioner. There is no doubt that the accusations that have been made need to be fully and thoroughly looked at, in line with the High Court case.
The hon. Lady’s second point related to human rights and our engagement with India. Let me make it clear: we believe that trade is vital for our economy and future  prosperity, but that in no way compromises the United Kingdom’s commitment to upholding human rights at the core of our foreign policy. We will not pursue trade to the exclusion of human rights. We regard both as important parts of a deep, mature and wide-ranging relationship with our international trading partners. The “2030 Roadmap for India-UK future relations”, which was agreed by the former Prime Minister with Prime Minister Modi, has a specific agreement about a commitment to resolving long-running or complex consular cases.
On the other specific cases that hon. Lady raised, I see the Minister for Asia and the Middle East on the Front Bench, who covers a different thematic region in the world, and she will no doubt take them on board. I am happy to ensure that the hon. Lady gets an answer about what the Government are doing on those matters.

Bob Blackman: I congratulate the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) on pursuing this case on behalf of his constituent. He has been assiduous in pursuing justice for Jagtar Singh Johal. I will come back to the plight of Jagtar Singh Johal rather than the case against the Government. I understand that he is a member of the Khalistani Liberation Force, which is a proscribed organisation in India. Indeed, at the moment he is facing up to eight charges of murder or attempted murder. Will my hon. Friend ensure that consular assistance is provided to him so that he gets a fair trial, and then we can deal with the issues that result?

Martin Docherty: On a point of order, Madam Deputy Speaker.

Rosie Winterton: I will take the point of order at the end.

Rehman Chishti: The specific question that we have before the House today looks at the welfare and treatment of a British national in India, where there are specific concerns about his welfare and treatment. The United Kingdom Government have made it clear through the number of engagements and representations that we have made—nearly 100 between officials and Ministers, including Prime Minister to Prime Minister and Foreign Secretary to Foreign Secretary—how importantly we take these concerns. My hon. Friend’s point about the accusations and allegations is that—

Martin Docherty: Allegations.

Rehman Chishti: Allegations. If I may finish, what I would say is that the accusations and allegations that have been made with regard to the situation of a British national abroad need to be looked at fully and fairly, in line with India’s commitments to human rights, domestic law and international law. That is what we would regard for any citizen anywhere around the world.

Rosie Winterton: I call the SNP spokesperson, Stuart C. McDonald.

Stuart McDonald: I pay tribute to my hon. Friend the Member for West Dunbartonshire (Martin Docherty-Hughes) for securing this urgent question and for his relentless campaigning on behalf of his constituent. I echo his comments 100% and agree with  what he said. As I understand it, the outgoing Prime Minister has previously been absolutely clear that this is a case of arbitrary detention. Is that still the Minister’s position? It seems absolutely clear that Mr Johal has been disgracefully treated during that detention, so will the Government call for his release? It is a simple question. I appreciate that legal proceedings are ongoing just now, but can the Minister assure us that in the fulness of time there will be a full statement to this Parliament about exactly what went on and the sort of inquiry that my hon. Friend calls for.
Can I raise two final issues? We know about this thanks to the diligent work of organisations such as Reprieve, but it brings to our attention the issue of whistleblowers. We know that 99% of the time our security services serve us absolutely fantastically well, but things do go wrong and abuses happen, so is there not now a need for protection of whistleblowers and for public interest defences in relation to disclosures—for example, in relation to the National Security Bill going through Parliament just now?
On that Bill, does the Minister agree that, hypothetically, if UK agencies are found liable for damages for actions they undertake that lead to torture abroad, those damages should be paid? If so, why does the Bill—in clause 58 —appear to create new and unnecessary ways to avoid the security services having to meet those damages? How can that be justified in any way, shape or form?

Rehman Chishti: The first part of the hon. Member’s question was about the view taken by the former Prime Minister of arbitrary detention and Mr Johal’s case. The United Nations working group on arbitrary detention has issued its opinion about Mr Johal. We take this seriously and have consistently raised our concerns about Mr Johal’s case directly with the Government of India. We are committed to doing what we can to assist him.
On the second part of the hon. Member’s question about arbitrary detention and the issue of release, the focus of these cases is always on working in the best interests of the individuals concerned. There is no blanket approach for these cases; our approach is tailored for specific individuals. I am sure that the new Prime Minister and Foreign Secretary will want to review this case as a priority.
On the hon. Member’s specific point about the National Security Bill, the Home Office leads on that matter. Again, I do not comment on matters relating to the intelligence agencies, or on this specific case because of a live civil litigation case in the High Court.

Several hon. Members: rose—

Rosie Winterton: Order. Before I call the next hon. Member, I want to emphasise that I have advised right hon. and hon. Members to exercise caution in what they say. However, just to be clear, I cannot force people to stick to that; it is my advice.
I want to try to get everybody in, but that means short questions—not a series of questions from now on, but a short question—so that the Minister is able to respond quickly. In that way, I can try to get everybody in.

Flick Drummond: The UK has a close relationship with India, and our partnership is vitally important to both nations, but also for global peace and security, and not least trade. Can my hon. Friend confirm that the UK Government will continue to discuss the importance of human rights and the rule of law with India as part of that partnership, especially in relation to any forthcoming trade deals?

Rehman Chishti: Madam Deputy Speaker, you said that brevity is a virtue, not a vice, and the answer to that question is yes.

Tan Dhesi: According to revelations from Reprieve and investigative journalists, it was apparently a tip-off by British security services that led to the arrest and arbitrary detention of Jagtar Singh Johal in India. All the while, Conservative Ministers were informing us ad nauseam that they were doing their very best and they were protecting his rights as a British citizen. What utter hypocrisy. Can the Minister confirm whether the outgoing, disgraced Prime Minister, during his tenure as Foreign Secretary, signed off the tip-off that led to arbitrary detention, including serious allegations of torture?

Rehman Chishti: I would again make the point to the hon. Member that there is a separation of powers between the judiciary, the legislature and the Executive. [Interruption.] He has made an allegation about what a former Prime Minister may or may not have known of this specific case. The matter is before the High Court. I cannot comment on this matter in that regard and I will not comment on it.

Dan Jarvis: I pay tribute to the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) for the tenacity with which he is pursuing the release of his constituent. I also associate myself with the remarks made by the right hon. Member for Haltemprice and Howden (Mr Davis).
This is a deeply concerning case. As we have heard, earlier this year the UN working group on arbitrary detention declared that Jagtar’s detention in India is unlawful, and I, along with other right hon. and hon. Members, raised that earlier this year. The new Government need to move urgently to try to end this nightmare and secure his release. As an absolute minimum, can I ask the Minister to try to ensure that the new Prime Minister raises this matter in her first call with her Indian counterpart? Can the Minister also give an assurance that he and his colleagues across Government will continue to raise their concerns at every available opportunity?

Rehman Chishti: On whether this matter can be raised at every level, including Prime Minister to Prime Minister, the current Prime Minister, when Foreign Secretary, raised this case with her counterpart and she is fully aware of it. The case was previously raised by Prime Minister Johnson with Prime Minister Modi at the highest level, and Lord Ahmad in the other place has raised it consistently. The hon. Member’s point is about whether this matter can be conveyed. I cannot say to the Prime Minister what must be raised in those meetings—that is a matter for her—but she will have heard his view, and I will convey the point back to the Prime Minister’s office that this has been raised.

Alistair Carmichael: The Minister may wish to reflect on the fact that the purpose of the sub judice rule is the protection of proceedings in court; it is not for Ministers to hide behind. The Minister is clearly not going to answer the questions about the ministerial sign-off today, but can he, in fulfilment of his duties to this House, tell us whether or not that information is held within Government?

Rehman Chishti: The right hon. Gentleman asks what specific information is held about what was said, and I would say to him that there is a case going on at the High Court. Subject to what Madam Deputy Speaker—or Mr Speaker—says, after that case has been held at the High Court and the determination has been made, he would be within his rights to ask an urgent question on the Floor of the House. However, speculating at this point in time about what information may or may not be held is not the right thing to do. The top priority for me and this Government is to do everything we can to support Mr Johal and his welfare.

Valerie Vaz: Can I just tell the Minister that there is a separation of powers, but it is our job to hold him to account—we ask him questions—and it is for judges to decide on the case? If they are civil proceedings, they are in open court, so everybody can go along and hear the case. I have a very simple question. Mr Jagtar Singh Johal is a British citizen. Has he received consular assistance, and if so, when?

Rehman Chishti: On the second point about consular assistance, the question that the hon. Member for West Dunbartonshire asked was about the proceedings that were to take place in court today. They did not take place because the Indian authorities did not put forward the papers for the prosecution. British officials were at that hearing today. We have been very supportive of Mr Johal, with consular support as well as the support through Ministers meeting his family here in the United Kingdom.

Alison Thewliss: I have three Sikh gurdwaras in my constituency: the Central Gurdwara, Singh Saba; the Guru Granth Sahib in Pollokshields; and the Shri Guru Tegh Bahadur, which is also in Pollokshields. Those in the Sikh community in Glasgow are deeply concerned for Jagtar Singh Johal, and they send their solidarity to him and his family. They are also deeply worried about any trip that they may be making to India, so can I ask the Minister what possible reassurance he can offer them?

Rehman Chishti: I, too, have a Sikh community in my constituency, at the Byron Road gurdwara and the Franklin Road gurdwara, and absolutely, I think the point I would make on that is that the United Kingdom’s top priority is the welfare of its citizens abroad. On that basis, we will do everything we can to support our citizens abroad.

Seema Malhotra: I have been contacted by many of my constituents, from all backgrounds, who are concerned about the welfare and continued detention of Jagtar Singh Johal. The UN has confirmed that this is an arbitrary detention, with the working group on arbitrary detention calling for his  immediate release. If it is Foreign Office policy to call for the release of arbitrarily detained British nationals, have the Government done so in this case, and if not, why not?

Rehman Chishti: On arbitrary detention and the specific point about release I will again give the answer I gave earlier: the focus of these cases is always to work in the best interests of the individuals concerned. There is no blanket approach to these cases, and they are tailored to specific individuals. I am sure that the new Prime Minister and Foreign Secretary will want to review this case as a priority, which goes to the point about determination of arbitrary detention in that regard.

Stephen Timms: The policy on intelligence sharing with overseas intelligence agencies is covered by a document called “The Principles”. At the moment there is a loophole in that, which allows Ministers to authorise tip-offs leading to torture, contrary to UK and international law. Will the Minister ensure that that loophole is removed, so that it is absolutely clear that Ministers must not authorise tip-offs leading to torture?

Rehman Chishti: If the right hon. Gentleman would write to me in detail on that specific point, I can ask officials to look into it and come back to him on that technicality.

Anum Qaisar: Since his arbitrary detention by Indian authorities, Jagtar Singh Johal has been represented—I use that word loosely—by three Prime Ministers and five Foreign Secretaries, none of whom has managed to secure his release. Jagtar has been tortured into signing a false confession, denied proper access to a lawyer, and potentially faces the death penalty. Will the Minister, and the newly appointed Foreign Secretary, make Jagtar’s release an immediate priority? Will the Minister commit today to further ministerial statements on this matter? It does feel like he is hiding behind a smokescreen.

Rehman Chishti: This case is a priority for the United Kingdom Government, and it will be a priority for the Foreign Secretary and Prime Minister. The Prime Minister raised the issue directly with her counterpart in India when she was Foreign Secretary, so yes, it is a priority for the United Kingdom Government.

Sarah Champion: I need to push the Minister on a specific point. The outgoing Prime Minister accepted that Jagtar Singh Johal has been arbitrarily detained. The Minister says that the Foreign Office does not have a blanket approach, but that is not correct. It has always been Foreign Office policy to call for the release of arbitrarily detained British nationals, yet the Government have not done so in this case. Will the Minister explain why the Government have not acted in line with their own policy, and will he commit to seeking Jagtar’s urgent release and return to the UK?

Rehman Chishti: The hon. Lady is correct to say that the former Prime Minister made a determination on arbitrary detention, and the United Nations working group on arbitrary detention has issued its opinion about Mr Johal. That is the point—the new Foreign  Secretary and new Prime Minister will have to make a determination for themselves on this matter. The hon. Lady asked about the former Prime Minister, and that was his opinion. The new Prime Minister and Foreign Secretary will need to come to their own opinion on this matter.

Khalid Mahmood: I welcome the Minister to his place. The crux of the matter is that whether or not this issue is before a civil court is the prerogative of the Government. They can pull that and deal with the real issues and concerns of the family of somebody who has been tortured in an Indian prison since 2017. We want the Minister to do what we would expect for a British citizen, and for the Government to deal with the issue and bring Mr Johal back home to his family.

Rehman Chishti: The hon. Gentleman is absolutely right to say that we should do everything we can to support Mr Johal and his family. That is why there have been nearly 100 forms of communication between officials and Ministers and their Indian counterparts about Mr Johal’s case. It is a top priority for us, and we will do all we can to support him and his family.

Chris Stephens: I congratulate my hon. Friend the Member for West Dunbartonshire (Martin Docherty-Hughes) on securing this urgent question. Many people will think that the fact that negotiations on a free trade deal with India are going on at the same time as a UK national faces the death penalty is simply grotesque. Will the Minister confirm that negotiations on any free trade deal with India will cease until Mr Johal returns home?

Rehman Chishti: We will not pursue trade to the exclusion of human rights, and we regard both as an important part of a deep, mature, and wide-ranging relationship with our international trading partners. More specifically, the United Kingdom is very clear that we are opposed to the death penalty.

Debbie Abrahams: This is a real test for the new Government: do they agree with universal human rights and a rules-based system, or not? If they do, they must demand that Mr Johal is immediately released and returned to this country.

Rehman Chishti: On the first point about the Government’s commitment to an international rules-based system, the answer is yes, as it is for the United Kingdom Government’s commitment to open societies and human rights. I have previously given an answer on the specific point about arbitrary detention and the issue of release.

John Spellar: The blunt arbitrary detention without trial of Jagtar Singh Johal would be a disgrace even if he were not being tortured and abused, especially as it seems that he is a British citizen. Will the new Foreign Secretary and Prime Minister make absolutely clear to the Indian authorities that if they think they have substantial evidence against Mr Johal, as alleged by the hon. Member for Harrow East (Bob Blackman), they should bring him to an open court straightaway for a fair trial? If, as is much more likely, they do not have  such evidence, Mr Johal should be freed from prison at once, and allowed to return to his family in the United Kingdom.

Rehman Chishti: This case is a top priority for the United Kingdom Government, the Foreign Secretary and the Prime Minister, and I will ensure that everything is done to ensure that Mr Johal’s case is dealt with as quickly and swiftly as it can be.

Kirsten Oswald: I am grateful to my hon. Friend the Member for West Dunbartonshire (Martin Docherty-Hughes) for his persistence in this case. That is doubly important because it sounds as if the Minister is somewhat rowing back and hiding behind proceedings today. That is wholly unacceptable. My constituents who often travel to India, and constituents across Scotland and the UK, will be looking at this case with deep concern. What will the Minister do to move this forward and ensure that we accept this as a case of arbitrary detention? How can he reassure those who come and go from India that the UK Government will not simply abandon them on a whim, as they have Jagtar?

Rehman Chishti: The hon. Lady says that I might be hiding behind procedure, but she knows me as a parliamentarian for 12 years, and I have previously stepped aside from the Government on matters of principle. In this case, the Government are doing all they can to support Mr Johal, and this is a top priority for his family and the United Kingdom Government. The matter has previously been looked at from Foreign Secretary to Foreign Secretary, and from Prime Minister to Prime Minister. I know Lord Ahmad, who covers that part of the world, has been looking at this case consistently with his counterparts in India, and the matter is a top priority for the Government.

Abena Oppong-Asare: Like many of my constituents, I am deeply concerned to hear that Jagtar’s legal team have provided evidence that Jagtar’s detention and torture took place following a tip-off by MI5. I am absolutely appalled by the Minister’s comments in the Chamber today, which show a lack of compassion and a lack of action on this issue. The Minister says he is unable to comment due to legal proceedings, but I believe it is in the Government’s gift, right now, to explain to the House what measures they are taking to remedy that. What review has taken place following what has happened? This is deeply concerning, and we cannot allow it to happen to many other people. I urge the Minister to clarify to the House whether a review has taken place, and what steps the Government have taken, instead of ducking and diving.

Rosie Winterton: We really must make sure that questions are very brief, so that I can try to get everybody in.

Rehman Chishti: Thank you, Madam Deputy Speaker. The hon. Lady says that Ministers lack compassion, but when I was the British envoy for religious freedom I worked tirelessly with partners around the world to help release individuals who were being persecuted for their faith. She asks what has been done, but I have answered the specific point. The matter is before the High Court,  which is dealing with accusations and allegations regarding what information was shared with whom. That is a matter for the High Court. Let the High Court deal with this matter, and once it has, the hon. Lady is within her rights to bring the matter back in a question to the House.

Steve McCabe: The Minister has referred to two meetings: one where the former Foreign Secretary raised the case and one where the former Prime Minister raised it with Mr Modi. Presumably, that is evidence of the Government’s good efforts, but there must be notes from those meetings. Will the Minister put them in the House of Commons Library?

Rehman Chishti: With regard to any specific notes, they will be dealt with in accordance with procedure.

Patrick Grady: A great many worshippers at the Guru Nanak Sikh temple on Otago Street in Glasgow North have signed a petition calling for Jaggi’s release. Will the Minister confirm that, if Jagtar was in the UK and the Indian Government wanted to extradite him, that would not be possible because of the threat of a death sentence? So why should he be threatened with capital punishment after being arbitrarily detained on the streets of India?

Rehman Chishti: I did not quite hear the hon. Member’s question, so I will take it away and get him a full answer.

Mohammad Yasin: Jagtar Singh Johal’s legal team have presented extensive evidence suggesting that the British national’s detention and torture followed a tip-off by MI5 and MI6. Will the UK Government now acknowledge and apologise for any role in Jagtar’s detention and take responsibility for securing his release and redress for the abuses that he has suffered?

Rehman Chishti: As I have said before, with regard to the UK Government’s position, we will do all that we can to support Mr Johal and his family. The former Foreign Secretary—now the Prime Minister—met the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) and Mr Johal’s brother Gurpreet Singh Johal on 9 June. Lord Ahmad, the lead Minister on the case, has met Gurpreet Singh Johal on at least seven occasions. That answers the hon. Member’s point about what the UK Government are doing and our commitment to do all that we can to support Mr Johal at this specific point in time.

Allan Dorans: The Sikh community in Scotland and elsewhere contributes significantly to the economic, civic and cultural life of this country. Do the Government understand and appreciate the damage caused to that community’s trust and confidence in them by failing to achieve justice for Jagtar? What action will they take to rectify the situation and reassure Sikhs not only in this country but throughout the world?

Rehman Chishti: I agree with the hon. Gentleman, and the UK Government pay a huge tribute to the contribution of the Sikh community across the board. They stood with us in the second world war and the first world war, and contributed to our freedom and liberty.  They were a part of us all the way through, and their contribution to our great country absolutely needs to be—and is—recognised by every Member of Parliament. I say to him and Members across the House that this is a specific case, and the UK Government will do all that they can to support Mr Johal, but we are all united in recognising the contribution of the Sikh community.

Matt Western: I congratulate the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) and align my position with that of my right hon. Friend the Member for Warley (John Spellar). My constituents are really concerned about the situation with Jagtar Singh Johal and the Government’s failure to support a British national. They are also concerned and frustrated about the lack of transparency and action in certain other cases, including those of Morad Tahbaz, who is in an Iranian prison despite the Foreign, Commonwealth and Development Office requesting his release, and Alaa Abd El-Fattah, who is in an Egyptian prison. Will the Minister place a report in the Library to update the House on their cases?

Rehman Chishti: I will ask officials to publish in the House what can be published on the specific cases that the hon. Member mentioned.

Taiwo Owatemi: I really hope that the Minister is taking Jagtar’s case seriously, because sadly this not an isolated incident: we have faced similar difficulties in defending the west midlands three in Coventry North West. Will the Minister reassure me and my constituents that Jagtar’s freedom will never be up for negotiation in efforts to strengthen wider relations with the Indian Government?

Rehman Chishti: If the hon. Lady wants to write to me on her specific constituency case, I will ensure that Ministers look at those points and come back to her.

Jim Shannon: I know that the Minister is committed to addressing issues of human rights across the world—I have worked with him and understand that. Does he not agree that the view of the UN working group, our own FCDO and legal judgments have made it clear that the treatment of my friend’s constituent is internationally unjustifiable and that action must be taken immediately to bring Jagtar Singh Johal back home to the UK and send a clear message that the United Kingdom’s innocent citizens—British passport holders—must be a Government priority in India and, indeed, anywhere in the world?

Rehman Chishti: I pay tribute to my hon. Friend for all the fantastic work that he does on freedom of religion or belief and supporting individuals who are persecuted for their faith around the world. He made a point about the UN working group on arbitrary detention, and that working group has given India until 2 November to respond to its findings. That date has been made clear to the Indian Government. The UK Government are clear, and I am clear, that we are committed to doing all that we can to support Mr Johal and his family.

Rosie Winterton: I thank the Minister for answering the urgent question.

Martin Docherty: On a point of order, Madam Deputy Speaker. Earlier, you were clear about what is not exactly a regulation of the House but advice to Members on sub judice and privilege, and that was clearly broken and taken advantage of. I do not know about Government Members, but those on the Opposition side clearly saw it as an abuse of privilege. Frankly, I do not like it when Members become spokespersons for a foreign state. Given that a Member of this House has impugned the integrity of my constituent on the Floor of the House of Commons of the United Kingdom of Great Britain and Northern Ireland, what is open to me as a constituency MP and those defending the rights of their constituents in the courts to ensure that such matters do not happen again?

Rosie Winterton: I thank the hon. Gentleman for that point of order. I deliberately returned to the advice that I had previously given about Members exercising caution in their remarks. As I said, I cannot force people to follow that advice; it is merely advice. He has put on the record his strong view about what was said. If he wishes to pursue that in other ways, I am sure that the Clerks can advise him, but I really cannot add anything further to what I have previously said.

Alistair Carmichael: Further to that point of order, Madam Deputy Speaker. I think that the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) was referring to the hon. Member for Harrow East (Bob Blackman) and what he said. It is clear that the hon. Member for Harrow East was relying on the privilege given to him as a Member of this House to make those allegations, and it is equally clear that the allegations are contested. What mechanism is open to Members when information released under privilege is contested in such a way? Does the hon. Member not have to repeat it outside?

Rosie Winterton: I cannot prevent Members from expressing their views. I am concerned that the hon. Member for Harrow East (Bob Blackman) is not here. As the right hon. Gentleman knows, it is customary to inform an hon. Member if they wish to raise something concerning them. It is open to the right hon. Member to raise the matter on another occasion, but I suggest that he informs the hon. Member that he is going to do so, as that would provide an opportunity for a response. I think that we will leave it at that.

Lloyd Russell-Moyle: rose—

Rosie Winterton: I will take the hon. Gentleman’s point of order after the business statement from the Leader of the House.

Business of the House

Penny Mordaunt: I do not wish to detain the House for longer than is necessary, but, if you will indulge me, Madam Deputy Speaker, I want to pay a brief tribute to my predecessor, my right hon. Friend the Member for Sherwood (Mark Spencer). He is a great champion for this place and for Back-Bench Members in particular, and he took his responsibilities as Parliament’s representative in Government seriously. He was also rather good for morale. I hope that all Members will join me in thanking him for his service.
I should like to make a short business statement. The business for tomorrow, Thursday 8 September, will now be:
General debate on UK energy costs, followed by consideration of an allocation of time motion, followed by all stages of the Social Security (Special Rules for End of Life) Bill [Lords].
I shall make a further business statement tomorrow in the usual way.

Thangam Debbonaire: May I first welcome the new Leader of the House very warmly to her new role and join her in paying tribute to the right hon. Member for Sherwood (Mark Spencer)? This is one of those unusual roles where the opposite numbers have to work together quite closely on a number of House issues. I look forward to working with her, but I also pay tribute to and put on record my thanks to the right hon. Gentleman, who I enjoyed working with.
I am very much looking forward to hearing the details of the widely trailed energy plan, but may I ask the Leader of the House why the Prime Minister seems to be swerving scrutiny by not making a ministerial statement, which she would have had to put forward to her opposite number 45 minutes in advance and which would have involved answering Members’ questions directly? Will the Leader of the House ask the Prime Minister to consider making a statement, so that that can be offered to Members? Shadow Ministers cannot be expected to properly scrutinise very significant policy changes if they have not had a chance to read them in advance. What briefings, if any, will Members or shadow Ministers receive in advance of this very significant announcement, which they would have been given with a ministerial statement?
Members reading speculation about what might or might not be announced in the media is not good enough and Mr Speaker did ask the new Prime Minister, I think quite firmly this morning, if she would make sure that statements are always made to the House first, rather than being briefed?

Peter Bone: indicated assent.

Thangam Debbonaire: I am getting nods from the Deputy Leader of the House—quite right. We agree on this, so will the Leader of the House remind the Prime Minister of what Mr Speaker said to her today?
Finally, Labour has been calling on the Government for action on energy bills for months. I asked for a recall in August so that we could pass legislation as soon as possible, adopting Labour’s plan to freeze the energy price cap and ensure the burden of paying for it fell on the big oil and gas companies through a windfall tax. The Prime Minister ruled that out this morning. Why is she asking working people to pay the price instead?

Penny Mordaunt: May I start by thanking the hon. Lady for her very kind remarks about my predecessor? It is absolutely right that this House has time to debate these critical issues. Many colleagues will have been speaking to constituency businesses, as well as ordinary constituents, to understand the particular issues they are facing and what they think the solutions should be to the extreme problems the country is facing.
I have, as the hon. Lady would expect, already raised the matter of getting information in a timely way for Members with the lead Department, the Department for Business, Energy and Industrial Strategy. It is incredibly important that Members are able to scrutinise the solutions in a timely way, as well as, I hope, raise concerns and matters their constituents have asked to be pressed to the Prime Minister and the Chancellor. That I have carried out and I hope to provide further assurance on that as we continue.
The hon. Lady raises the Prime Minister’s commitment to ensuring that things are brought to this House. In Prime Minister’s questions just a short while ago,  I think she reiterated her determination to do that. I would also say that although the House has not been sitting across the summer, Ministers have not been idle. I pay tribute in particular to the former Chancellor, my right hon. Friend the Member for Stratford-on-Avon (Nadhim Zahawi), working with colleagues to ensure that whichever candidate won the leadership contest would have up to date information, given the volatility of the economy at the moment, to be able to make decisions. In the course of my duties, I will always do my best to ensure information is given to this House in the correct manner.

Mark Harper: I support what my right hon. Friend said about her predecessor, both in his capacity as Leader of the House and in his previous role as Government Chief Whip. I also take this opportunity to welcome her to this particular role, which I know she will hugely enjoy as a fantastic Member of this House. It is a great privilege to be Leader of the House and I know she will do the job very well.
May I just follow up on one of the questions asked by the shadow Leader of the House? My right hon. Friend did not explicitly say it, but I think she is indicating that tomorrow’s debate is the vehicle for the Government to announce their energy proposals. Assuming that is the case, Members will obviously want to scrutinise them. May I therefore ask, not just for the Opposition but for all Members, what information will be available to Members? Obviously, if we are to take part in a debate we need to have information. What information will be made available and when will it be available for Members? Presumably, it will have to be available, given that it is a  debate, before the commencement of the debate, and not, as would be usual for a statement, after the Minister introducing the debate has sat down. It would be helpful for the House if she could confirm that for us this afternoon.

Penny Mordaunt: I have raised these matters with the lead Department. I am expecting other Members of the House to also place this on record. It is important that we get these things right. I think the vehicle of a debate tomorrow has been chosen to enable Members to have some time to be able to talk about the experiences their constituents are going through, make further suggestions to the Government and get certain things on record. Obviously, a Minister will also respond to the debate. Clearly, if announcements are made, as much advance time about proposals that we can give Members in the proper way is very important. I assure all Members that we have made that case to BEIS.

Owen Thompson: I, too, welcome the right hon. Lady to her place as Leader of the House and pay my own tribute to her predecessor, the right hon. Member for Sherwood (Mark Spencer), both in his role as Leader of the House and as Chief Whip—probably more of my dealings with him were in that role.
I echo the comments of others in making a plea for information to be available as quickly as possible, so that Members have the opportunity to contribute properly to the debate tomorrow. I also ask a simple question: will the Prime Minister be leading on the debate tomorrow? If not, who will?

Penny Mordaunt: Subject to events, my understanding is that the Prime Minister will open the debate and the new Secretary of State for Business, Energy and Industrial Strategy will close it. Again, I thank the hon. Gentleman for his kind remarks.

Maria Miller: I warmly welcome my right hon. Friend to her new position and the announcement of a debate tomorrow on energy costs. However, that debate will replace a Backbench Business debate on the running of the House of Commons, which was called for by the Administration Committee of which I am a member. Will my right hon. Friend use her best offices to ensure that that debate is rescheduled as soon as possible, notwithstanding that the timing of Backbench Business debates are a little beyond her control?

Penny Mordaunt: I apologise to Members who were looking forward to taking part in that debate. I have spoken with the Chairman of the Backbench Business Committee and the Member in whose name the debate stood. Clearly, my part in this is to make sure that that Committee has time on the Floor of the House. I have undertaken to ensure that time is allocated in good time for the Committee to make a decision about what debates it wants to bring forward.

Alison McGovern: I welcome the right hon. Lady to her new role. It is no use crying over spilt milk, but all this is already slower than it should be when our constituents needed action over recess. Maybe it is me being a bit thick, Madam Deputy  Speaker, but I do not quite understand what decisions we are taking tomorrow. We are having a general debate but we do not know what the policy is yet, so we do not know what we are generally debating. That general debate will, I assume, be on a neutral motion, so what exactly would be the action that we are taking tomorrow?

Penny Mordaunt: The debate is an opportunity for all Members to raise their specific concerns. Many Members will have been talking to their constituents about particular things that they want to see. It is an opportunity for them to raise those issues tomorrow. Clearly, those opening and closing the debate will be putting forward measures that the Government want to bring forward. It will not be the only opportunity for the House to scrutinise the measures, but that is the purpose of the debate tomorrow.

Wera Hobhouse: I also welcome the right hon. Lady to her new role and echo her words about her predecessor, the right hon. Member for Sherwood (Mark Spencer).
I understand from my Whip that the business of this week and the following week had been agreed with both leadership candidates during the summer break, but we have seen a lot of chopping and changing this week. That does not inspire confidence in where the Government are going and the certainty of all of us in this place about the agenda. Will the Leader of the House assure us that, under her leadership, we will see no more chopping and changing of the business of the House?

Penny Mordaunt: I will say two things. First, I very much understand my role as being hon. Members’ representative in Government, and I will do everything in my power—I hope Members have confidence in how I have conducted myself prior to this role—to work in a constructive, positive way and with all the courtesies that the House would expect.
I also have a role in this Government to ensure that Whitehall and we in this place move at the speed at which our constituents need us to. I therefore make no apology for bringing forward tomorrow’s debate. It is important that Members of the House are able to raise these important issues, and I will do everything I can to give as much notice as I can of any changes to our legislative programme.

Stella Creasy: Further to hon. Members’ comments, I welcome the Leader of the House to her new position. She said that she wishes to be our representative in Government. Can she therefore understand the frustration of many of us that the press is briefing that the business for Monday—the Bill of Rights—has been shelved? Will she do the House the courtesy of telling us whether it has been shelved? If it is happening because the new Home Secretary said that the Government needed to be honest for the legislation to do what they want it to do, the Government needed to commit to leaving the European Court of Human Rights. So will the Bill be brought back with our leaving the European Court of Human Rights—yes or no?

Penny Mordaunt: I will make a further business statement tomorrow in the usual way. I ask Members to recognise that we are in very volatile times economically. We will need to do things swiftly. Members have been asking for  things to happen swiftly on these matters and we will do that. I will make a business statement tomorrow in the usual way and I will answer the very understandable questions that hon. Members wish to raise.

Nick Smith: This is not good enough; the country deserves better. The Government’s energy plan is said to involve £100 billion-plus of expenditure. That will involve very complex arrangements. A general debate is good, but when will we see the economic event that the Government have been promising for a while? The country really needs to get a grip of the Government’s energy plans now.

Penny Mordaunt: As I said, a lot of work has been going on throughout the summer not only in Whitehall, but with energy companies and other stakeholders. Proposals are very advanced. Those will be brought to the House tomorrow, as we would expect, but we feel that it is very important to give all Members of the House the ability and the time to raise issues that their constituents have raised with them. However, that will not be the only moment for the House to scrutinise policies that are being introduced on the specific issues of the cost of living and business costs as well as the wider programme related to growth.

Lloyd Russell-Moyle: I welcome the Leader of the House to her place; she has been very competent in previous roles, so I look forward to that level of competency going forward. However, a key aspect is that we will get to see, on the publication of the agenda tonight, the content of what we will debate. We would expect that for any other form of Bill, legislative process or debate. We can get a general debate through the Backbench Business Committee or on an Opposition day. We need something more concrete. Our constituents need concrete things about which I can go and tell them tomorrow morning, “This is what we are doing to help you.” My constituents do not want to hear me just talk; they want action.

Penny Mordaunt: I reiterate that we have made that very clear to the lead Department. Again, this is a debate that will give all Members of the House the chance to contribute and help to raise issues that they and their constituents are concerned about. This will also not be the only opportunity that Members get to help to shape that legislation.

Jim Shannon: On behalf of my party, I also welcome the right hon. Lady to her position as Leader of the House and I look forward to her contribution. She will be aware that the former Chancellor, the right hon. Member for Stratford-on-Avon (Nadhim Zahawi), visited Northern Ireland in the past month to get the process in place for the moneys that were coming through for each and every household across Northern Ireland. Decisions were made with the then Chancellor and the Minister for the Northern Ireland Assembly. The Leader of the House will know that the Northern Ireland Assembly is not meeting. With that in mind, will we get an indication tomorrow from the Prime Minister or the Minister responsible of how Northern Ireland’s households will be allocated the money? That would be helpful for us in this process. We are ever  mindful that the Assembly is not working, and the Northern Ireland Protocol Bill is very much part of our thoughts.

Penny Mordaunt: I thank the hon. Gentleman for his very kind remarks. I understand that we will spend a lot of quality time together—such is his reputation. I assure him that the proposals that are introduced will be UK-wide.

Rosie Winterton: I thank the Leader of the House for her first business statement.

Points of Order

Lloyd Russell-Moyle: On a point of order, Madam Deputy Speaker. Yesterday, all Members of the House received an email from the Home Office stating that, in future, in “the majority of instances”, the Home Office will deal with our letters and correspondence
“by telephone to provide responses”
and:
“Where this is not possible you will receive responses to multiple enquires in a single letter.”
First, I have grave concerns about that from a GDPR point of view—how can I respond to a constituent with a letter that mentions numerous constituents? Secondly, I have a concern about the Home Office not responding apart from orally, where we cannot then record what has been said on the telephone. Will you advise me, through your good offices, whether this is an appropriate response from the Home Office?

Penny Mordaunt: rose—

Rosie Winterton: I am delighted to say that the Leader of the House is going to help us out.

Penny Mordaunt: Further to that point of order, Madam Deputy Speaker. I hear the hon. Gentleman and will take this issue up with the Home Office. I know that it is very keen to get replies back, particularly on very pressing constituent issues and systems that have been under great strain. However, I very much understand that the quality and timeliness of departmental correspondence is of immense importance to us all in being able to carry out our jobs. I have already had conversations with the new Chancellor of the Duchy of Lancaster about how we can undertake continuous improvement on this issue. We take this very seriously and I will raise this matter.

Rosie Winterton: I thank the Leader of the House for that very helpful response. I am sure that she will come back with further information, perhaps during one of the business statements.

Deputy Speaker’s Statement

Rosie Winterton: Mr Speaker has received a letter from Tom Tugendhat indicating that he wishes to resign from the Chair of the Foreign Affairs Committee. Mr Speaker has therefore declared the Chair vacant. Nominations for the election of a new Chair will close at 12 pm on Tuesday 20 September. If there is more than one candidate, the ballot will be held on Wednesday 21 September. In accordance with the order of the House of 16 January 2020, only Members of the Conservative party may be candidates. Nomination forms and further information about arrangements for the election will be made available in the coming days.

Lithium-Ion Battery Storage (Fire Safety and Environmental Permits)

Motion for leave to bring in a Bill (Standing Order No. 23)

Maria Miller: I beg to move,
That leave be given to bring in a Bill to make local fire services statutory consultees for industrial lithium-ion battery storage planning permission applications; to make provision about the granting of environmental permits for industrial lithium-ion battery storage; and for connected purposes.
The Bill would ensure that industrial lithium-ion battery storage facilities are correctly categorised as hazardous, so that the Environment Agency, the Health and Safety Executive and the fire and rescue services would be statutory consultees when planning applications are considered.
Technological innovation is on an exponential curve, and nowhere is that more evident than in renewable energy generation. Under this Government, in 2019—for the first time ever—zero-carbon electricity production overtook fossil fuels. This transition to renewables is essential to protect our environment, but is also crucial geopolitically. We know only too well that hostile powers are willing to use energy supplies as a weapon. Home-grown renewable energy can help to shield us from attacks. With renewable energy, capture and storage become crucial. A library of Government plans and reports since 2017 cite the removal of barriers to electricity storage as crucial in our transition to greener energy.
The high water mark of energy storage is industrial lithium batteries, which make up more than 90% of the UK’s storage capacity. By releasing energy into the power grids when it is required, these batteries shift peaks of supply to match demand, providing us with renewable electricity even when the air is still and the skies are grey. A handful of storage facilities are already operational in the UK, but a large number are due to come on stream in coming years; 366 projects are under construction or awaiting planning permission.
So what is the problem? Lithium-ion batteries are innocuous when they function normally, but if they fail, a process called thermal runaway—what we would call a battery fire—occurs, and there is a complex chemical reaction. It can occur for many reasons: the battery may be overcharged, there may be outside interference or the battery may have a design fault. The only way to stop a battery fire is to cool it down with a constant stream of water and wait for the fire to go out, which might take days, creating huge quantities of water containing highly corrosive hydrofluoric acid and copper oxide—by-products of battery fires. These toxic chemicals cannot be allowed to seep into watercourses, because they would cause immense environmental damage.
Current regulations do not require battery storage planning applications to be referred to the Environment Agency, the Health and Safety Executive or, indeed, the fire service. Planning permission is being granted near nurseries, hospitals, houses, rivers and even industrial chemical manufacturing plants. In my constituency, a battery facility has been granted planning permission on Basing fen, metres away from the headwaters of the River Loddon, close to a hospital and near the town  centre. The application was only spotted by assiduous local residents and local councillors Kate Tuck—who is with us today—and Onnalee Cubitt when a further application was submitted for a larger site. Should a fire break out at the storage facility on Basing fen, the water used to cool the plant would flow straight into the River Loddon. There is no requirement for a storage tank for firewater. Toxic water would continue to wash downriver towards the Thames.
A battery fire can produce a cloud of dangerous gas—hydrogen fluoride, methane and carbon monoxide. If the vapour cloud from a battery fire meets an ignition point, it can explode, as happened in Arizona in 2019; fire officers tackling that battery fire suffered life-changing injuries when the unit exploded. That fire was far from unique. Thermal runaway events occur in almost every country in which battery storage is used. Even South Korea, a pioneer in the development of battery storage, experienced 23 major battery fires between 2017 and 2019. Nearer to home, in September 2020 a battery storage facility fire in a residential area in the constituency of the hon. Member for Liverpool, West Derby (Ian Byrne), a stone’s throw from a nursery, caused a violent explosion that blew debris up to 20 metres. It took 59 hours for the fire to be put out, during which residents were asked to keep their windows and doors closed because of the billowing smoke.
We need lithium-ion battery storage facilities, but they must be seen correctly for what they are: highly complex, with the potential to create dangerous events and hazardous substances. The good news is that we do not need new regulations; we simply need to better use the regulations we have. We already have robust legislation, the Planning (Hazardous Substances) Regulations 2015 and the Control of Major Accident Hazards Regulations 2015. My Bill would correctly apply those regulations to battery storage sites.
We have to heed warnings from experts such as Dr Wade Allison, professor of physics at Oxford University, who said that
“although batteries are essential to our world, naively multiplying them while ignoring safety questions is dangerous and negligent. That is what is happening. Large-scale battery energy storage systems should be classed as hazardous establishments in order to be regulated appropriately”.
By correctly categorising industrial lithium-ion batteries as hazardous, my Bill would ensure that the Environment Agency and the HSE were consulted during planning applications.
Furthermore, Phil Clark, the emerging energy technologies lead at the National Fire Chiefs Council, has called for
“developers to engage at the earliest opportunity with the local Fire and Rescue Services.”
He explains that
“the National Fire Chiefs Council are still learning about the potential impact of the exponential introduction of lithium batteries. Without an understanding of the risks and appropriate control measures required, we risk as a society creating the next legacy fire safety issue”—
his words, not mine. My Bill would make fire and rescue services statutory consultees for all battery storage facilities.
The evidence shows that the current regulations for lithium-ion battery storage facilities do not reflect the true risk. I urge the Government to support my Bill today and to announce an immediate review of those  facilities that have already been constructed or that have planning consent, to ensure that they do not pose a threat to residents or the local environment.
I am not sure whether there is a Minister in place at the moment—maybe there is a Whip.

David Evennett: indicated assent.

Maria Miller: I hope that somebody will agree to meet me to discuss action in more detail. We cannot allow lithium-ion battery storage facilities to continue as they are and become another legacy fire issue, with all the risks that that entails to the lives of the people we represent and the environment we want to protect. I commend the Bill to the House.
Question put and agreed to.
Ordered,
That Dame Maria Miller, Ian Byrne, Mr Richard Bacon, Matt Hancock, Allan Dorans, Mrs Flick Drummond, James Gray, Alicia Kearns, Stephen Metcalfe, Mr John Baron, Valerie Vaz and Dame Diana Johnson present the Bill.
Dame Maria Miller accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 24 March 2023, and to be printed (Bill 152).

Financial Services and Markets Bill

[Relevant documents: The First Report of the Treasury Committee, Future of financial services regulation, HC 141, and the responses, HC 690; Written evidence to the Treasury Committee, on Future of financial services, reported to the House on 6 September 2022, HC 141; Written evidence, taken before the Treasury Sub-Committee on Financial Services Regulations, on The Strong and Simple Framework, reported to the House on 10 August and 6 September 2022, HC 537; and Letter from the Governor of the Bank of England relating to the Financial Services and Markets Bill, dated 27 July 2022.]
Second Reading

Rosie Winterton: I inform the House that neither of the reasoned amendments has been selected.

Richard Fuller: I beg to move, That the Bill be now read a Second time.
The provisions of the Bill create the conditions for the United Kingdom to roll back or reform all European Union legislation for financial services that remains on our statute book. The Government will move at pace to implement a more agile and more internationally competitive set of rules that will harness the potential of UK financial services to stimulate growth across the United Kingdom.
Financial centres in the European Union, in the United States and across Asia are engaged with the United Kingdom in a global competition to attract financial services expertise, and to be the most successful in adopting the benefits of technology-driven change that may radically alter the shape and reach of financial services. The Bill will enable the United Kingdom to assert its leadership, and to drive forward change to capture a greater share of the global market for financial services. As the Prime Minister has said, the financial services sector is the
“jewel in the crown of the UK economy”,
and we are committed to supporting its ability to realise its full potential. An effective, efficient and easily accessible financial services sector is a vital foundation for the ease of daily life and for the national economy. The Government are therefore taking forward an ambitious set of reforms in this landmark Bill.

Caroline Lucas: The Bill contains a new statutory objective on competitiveness and growth, which ranks those elements above the UK’s legally binding nature and climate targets. Given that a thriving economy depends on a thriving environment, will the Minister look at this again and consider introducing a climate-and-nature-specific statutory objective as well, so that there are two statutory objectives rather than a statutory objective and a regulatory principle, which are not the same thing?

Richard Fuller: The hon. Lady is right to point to the importance of the objectives that are set for the regulators in financial services, but surely she will accept that the most fundamental principle for each of them should be the stability of financial services in the United Kingdom,  and we pay regard to that in the Bill. We have added, as she pointed out, some focus on global competition and on achieving growth across the United Kingdom. Those are the fundamental demands that the British people have of the financial services sector. However, it is important that we have regard to the issues that the hon. Lady has mentioned, and I am sure we will discuss them, and the priority that should be attached to them, in more detail in Committee.

Chris Grayling: May I pursue the point about environmental issues? I take my hon. Friend’s point about the need to secure the stability of the sector—that is not in dispute—but one of the things we have not done in this country is to take steps to place a duty on financial institutions not to invest in businesses that support deforestation around the world. Our combat against deforestation has run through a range of policies that the Government have pursued, and it should be continued. I will be asking my hon. Friend, as we go through this process—ahead of, possibly, tabling amendments on Report—to consider placing such a duty on the financial services sector, so that before it invests internationally, it at least asks the question “Will this lead to deforestation?”

Richard Fuller: I am grateful to my right hon. Friend for that addition to the debate. It is clear that there is interest in the House in debating the priority that is given to these particular issues, and I look forward to hearing the contributions of my right hon. Friend—and those of Opposition Members—in Committee, to establish whether we have got these matters right.

Angela Eagle: Will the Minister give way?

Richard Fuller: I will give way one more time, and then I will make a little progress.

Angela Eagle: There is much on the Bill for which I think there will be cross-party support, but there are some elements that worry me, and I wonder whether the Minister can reassure me about them. I refer to the Henry VIII powers, and the fact that a great deal of extra power will be given to the regulators and the Treasury. I worry about a lack of appropriate accountability to the House. Can the Minister give us some reassurances on the Henry VIII powers, and can he give us proper undertakings that he is not creating a system that will leave the House out?

Richard Fuller: Not surprisingly, the hon. Lady has put her finger on one of the most fundamental elements of the debate that we need to have on the Bill, which is the accountability of regulators, as expressed through the House and, if I may say so, through the Government. I can assure the hon. Lady that that will be a fundamental part of our debate throughout the Bill’s progress, and, indeed, I will say more about it later in my speech.

Emma Hardy: Will the Minister give way? This is further to that point.

Richard Fuller: If it is further to that point, of course I will.

Emma Hardy: I think that one of the points made by my hon. Friend the Member for Wallasey (Dame Angela Eagle) was not just about regulation post-Brexit, but about the power grab in the Treasury. Clause 3 deals with the Treasury’s powers during the transition, and it states that the primary legislation in schedule 1 will be bypassed, with powers given directly to the Treasury because of the need to move EU regulations speedily into domestic law. That, I think, is where one of the problems lies. It is a question of how much power is going directly to the Treasury and bypassing Parliament entirely.

Richard Fuller: The hon. Lady has made a useful point. She has identified the fact that there is an extensive amount of change in this Bill. As we repeal EU legislation, there will clearly be some measures on which there is a common view that they can easily be repealed and are unnecessary. It is right that the Treasury, and the Government, should be able to take those actions directly. Equally, there will be measures that will require full consultation by the House through secondary legislation, and I can give a commitment that that will be done apace, but with the ability for parliamentary colleagues to debate those measures fully. It is important that we achieve the primary objective of the Bill, which is to make the United Kingdom a solid global financial service centre.
In fact, the Bill has five objectives. They are to implement the outcomes of the future regulatory framework review, which involves reshaping our regulatory and legislative regime as an independent state outside the EU; to bolster the competitiveness of UK markets and promote the effective use of capital; to promote the UK’s leadership in the trading of global financial services; to harness the opportunities of innovative technologies in financial services; and to promote financial inclusion and consumer protection. I will take each of those in turn.
Let me deal first with the implementation of the outcomes of the FRF review. Clause 1 and schedule 1 repeal retained EU law for financial services so that it can be replaced with a coherent, agile and internationally respected approach to regulation that has been designed specifically for the UK. This will build on the existing model established by the Financial Services and Markets Act 2000, which empowers our independent regulators to set the detailed rules that apply to firms. They do this while operating within the framework and guard rails set by the Government and by Parliament.
Schedule 1 contains more than 200 instruments that will be repealed directly by the Bill. While in some cases these rules can simply be deleted, in many areas it is necessary to replace them with the appropriate rules for the UK, in our own domestic regulation. These instruments will therefore cease to have effect when the necessary secondary legislation and regulator rules to replace them have been put in place.
As we have already heard from Members today, giving these measures effect will require a significant programme of secondary legislation to modify and restate retained EU law. I can confirm that in most cases, this will be subject to the affirmative procedure in the House.

Peter Grant: I welcome the Minister to his new post. Is it not a fact—I mention this partly for the benefit of those watching our proceedings who  may be unfamiliar with it—that the House has the choice of taking or leaving each piece of secondary legislation that is presented to it, and Parliament will have no opportunity to amend secondary legislation if it does not think it is good enough?

Richard Fuller: As the hon. Gentleman will know, there will be plenty of opportunities for him to review each of the 200 measures in Committee, should he so wish, and to make recommendations. He will also be aware that the Government have already undertaken significant consultations with industry and others, and that there are ongoing reviews of a number of measures that are in place, some of which are contained in schedule 2. I do not feel that what he fears will actually be the case. There will be a process of consultation on a number of these measures, and there will be ample time for questions to be asked in the House as those consultation proceed.
As I have said, we have already undertaken fundamental reviews in some areas to ensure that we are seizing the opportunities of leaving the European Union, and this Bill delivers their outcomes. Let me touch on these briefly.
The Bill gives the Treasury the powers to implement reforms to Solvency II, the legislation governing prudential regulation for insurance. The Government are carefully considering all responses to their recent consultation and will set out their next steps shortly. The Bill also allows the Government to deliver on the outcomes of the UK’s prospectus regime review, taking forward key recommendations from Lord Hill’s UK listings review. These reforms will ensure that investors receive the best possible information, help to widen participation in the ownership of public companies and simplify the capital raising process for companies on UK markets. This can help to boost the UK as a destination for initial public offerings and optimise its capital raising processes.
The Bill also delivers, through schedule 2, the most urgent reforms to the markets in financial instruments directive—MIFID—framework, as identified through the wholesale markets review. It will do away with poorly designed and burdensome rules, such as the double volume cap and the share trading obligation, which will allow firms to access the most liquid markets and reduce costs for end investors. We intend to bring this into effect shortly after Royal Assent.
In reforming our regulatory framework, it is right to think about the regulators’ objectives so that they reflect the sector’s critical role in supporting the UK economy. For the first time, the Prudential Regulatory Authority and the Financial Conduct Authority will be given new secondary objectives, as set out in clause 24, to facilitate growth and international competitiveness. The FCA and the PRA will do this within an unambiguous hierarchy that does not detract from their existing objectives.
It is critical that these new responsibilities for regulators are balanced with clear accountability both to the Government and to Parliament. This is addressed in clauses 27 to 42, alongside clause 46 and schedule 7. The Bill includes new requirements for the regulators to notify the relevant parliamentary Committee of a consultation and to respond in writing to formal responses to statutory consultations from parliamentary Committees.  The regulators are ultimately accountable to Parliament for how they further their statutory objectives, so these measures recognise the importance of the Committee structure for holding the regulators to account. While I welcome the new Treasury Select Committee Sub-Committee, it is ultimately for Parliament to determine the best structure for its ongoing scrutiny of the financial services regulators.

Mark Garnier: I was on the Treasury Committee a number of years ago when we were looking at the Financial Services Act 2012, when competitiveness was not properly addressed. Is my hon. Friend convinced that the Treasury Committee will be able to instil a sense of urgency in the regulators and convince them that competitiveness is incredibly important? It is one thing to hold the regulators to account, but another to be able to drive them to implement the will of Parliament.

Richard Fuller: My hon. Friend opens up what was an area of particular personal interest to me when I was a Back Bencher, and I therefore feel tempted to stray, during what might be my rather temporary position on the Front Bench—[Hon. Members: “No!”] That was a cheap attempt for a laugh, but if I may just say this without straying too far, I think it is recognised across the House that the role of Parliament in holding regulators to account needs further investigation. The Bill is quite remarkable because we are building on a structure from the year 2000 that put tremendous power in the hands of the regulators. We think that is right. We do not think that we should have the same prescriptive statute-based approach as the European Union, because we feel that is too rigid, does not promote competition and does not help growth. But we must recognise, as we take the Bill through the House, that we have a responsibility carefully to ensure that those structures of parliamentary oversight are appropriate.

Alison Thewliss: I very much enjoy serving on the Treasury Committee, but it has an incredibly busy agenda. What the Government are doing here is taking a huge amount of scrutiny of incredibly important structural issues relating to financial services from 650 Members of Parliament and giving it to a Committee of 11 and a perhaps yet smaller Sub-Committee. Does the Minister really think that is adequate?

Richard Fuller: The hon. Lady tempts me to talk beyond what is really the responsibility of the Government. She is raising questions that are correctly and appropriately for the parliamentary authorities to respond to. On her more general point about whether the system is correct to rely on the regulatory framework that was established in 2000, I think the answer is absolutely yes. As I have just mentioned, it provides the ability for an agile, pro-growth, competitive set of financial services regulations, and I believe that Parliament itself is capable of providing that democratic oversight over the regulators. If she is concerned about that, I encourage her to take it up with the parliamentary authorities in the usual way.
So I welcome the Treasury Sub-Committee. I have said that ultimately it is for Parliament to determine the best structure for the ongoing scrutiny of financial services regulators. The Bill also includes a new power for the Treasury to require the regulators to review their  rules when that is in the public interest. Following any such review, the final decision on potential action would be for the regulators to make.
Following the repeal of retained EU law, the Government will have no formal mechanism to bring public policy considerations directly into rule-making. It is right for the democratically elected Government of the day to be able to intervene in a matter of financial services regulation where there are matters of significant public interest. The Government’s intention is therefore to bring forward an intervention power that will enable Her Majesty’s Treasury to direct a regulator to make, amend or revoke rules where there are matters of significant public interest. The Chancellor will take a final decision on the precise mechanics of the power and the Government will table an amendment in Committee.
Let me now turn to the Bill’s second objective: bolstering the competitiveness of UK markets and promoting the effective use of capital. I have already spoken about the improvements to the UK’s regulation of secondary markets in this Bill through reforms to the MIFID framework in the wholesale markets review. These changes will lower costs for firms and align our approach with that of other international financial centres such as the United States. To improve the smooth functioning of markets, we will introduce a senior managers and certification regime for key financial market infrastructure firms. We will expand the resolution regime for central counterparties to align with international standards, and enhance the powers to manage insurers in financial distress.
The next objective of the Bill is to strengthen the UK’s position as an open and global financial hub. Outside the EU, the UK is able to negotiate our own international trade agreements, including mutual recognition agreements—MRAs—in the area of financial services. The Government are currently negotiating an ambitious financial services MRA with Switzerland. Clause 23 enables the introduction of any necessary changes through secondary legislation to give effective to this and to any future financial services MRAs. Schedule 2 contains measures that enable the United Kingdom to recognise overseas jurisdictions that have equivalent regulatory systems for securitisations classed as simple, transparent and standardised, allowing UK investors to diversify their portfolio while maintaining the level of protections they currently enjoy.
The Bill takes the UK further forward as a centre for financial markets technology. Clause 21 and schedule 6 extend existing payments legislation to include payments systems and service providers who use digital settlement assets that include forms of crypto-assets used for payments, such as stablecoin, backed by fiat currency. This brings such payments systems within the regulatory remit of the Bank of England and the payments system regulator, allowing for their supervision in relation to financial stability, promoting competition and encouraging innovation.
To foster innovation, clauses 13 to 17 and schedule 4 enable the delivery of a financial markets infrastructure sandbox by next year, allowing firms to test the use of new and potentially transformative technologies and practices that underpin financial markets, such as distributed ledger technology. In parallel, the Bill promotes the finance sector’s resilience by allowing the financial service regulators to oversee the services that critical third parties provide to the sector.
Let me turn to the Bill’s final objective, which I know will have the commendable focus of colleagues throughout the House: the promotion of financial inclusion and consumer protection. The Government will continue to foster an industry that supports everyone so that individuals do not feel left behind by the rapid advancement in financial technology. There is an extensive programme of ongoing work related to consumer protection, especially in the areas that were legislated for in the Financial Services Act 2021, such as buy now, pay later agreements and the FCA’s rules on the consumer duty.

Stella Creasy: The Minister is relatively new to his role, but he cannot help but be aware that it is now almost two years since this House recognised the real threat to our constituents’ bank balances posed by buy now, pay later and its lack of regulation. There is agreement throughout the House that these legal loan sharks must be regulated. The Minister may say that this is a complex policy area, but political will and the cost of living crisis demand fast action. Why is the necessary regulation not in the Bill? It could have been the perfect vehicle, ahead of Christmas, when these companies will profit again, to act to protect our constituents.

Richard Fuller: The hon. Lady is right to talk about the urgency and complexity of the issue. She understands that it is complex and will invigorate us all to move as quickly as possible. I note that even as recently as 19 August the FCA has followed up with the buy now, pay later companies to remind them of the rules that they have to operate under, and that the Government have committed to bring forward the consultation on the draft legislation before the end of the year. I look forward to discussing matters further with the hon. Lady.
The 2021 Act made legislative changes to support the widespread offering of cashback without a purchase by shops and other businesses. Clause 47 and schedule 8 go further and give the FCA the responsibility to ensure reasonable access to cash across the UK. The FCA will have regard to local access issues and a Government policy statement on access more generally. The Treasury will designate banks, building societies and cash co-ordination arrangements to be subject to FCA oversight on this matter.

David Mundell: I very much welcome the provision in the Bill, because access to cash is an extremely important issue not only for rural communities that I represent but for deprived areas. Will the Minister make sure that when the various reviews and mechanisms are put into place they focus on the specific needs of rural and deprived areas in their determination of cash requirements?

Richard Fuller: My right hon. Friend is absolutely right. He will know that the question of access in urban areas is very different from that in rural areas. I can give him the assurance that he seeks.

Paul Maynard: I, too, welcome all the provisions, but will the Minister confirm that when he says “access to cash” what he actually means is free access to cash, not paid-for ATMs.

Richard Fuller: When I say “access to cash” I mean access to cash. My hon. Friend raises the question of whether that access should be free; that is a matter to which we will return in Committee, but I cannot give him that assurance at this stage.
As the country faces cost of living pressures, we must ensure that the door to affordable credit is open to all. The credit union sector plays a crucial role in this respect by delivering for its members and providing an alternative to high-cost credit. Clause 63 allows credit unions in Great Britain to offer a wider range of products and services to their members. To improve consumer protection, the Bill will strengthen the rules around financial promotions. Clause 62 enables the Payment Systems Regulator to mandate the reimbursement of victims of authorised push payment scams by payment providers, for all PSR-regulated payment systems, and places an additional duty on the regulator to mandate reimbursement in relation to the faster payments service specifically.
Clause 48 and schedule 9 give the Bank of England new powers to oversee wholesale cash infrastructure, to ensure its ongoing effectiveness, resilience and sustainability. Clause 47 and schedule 8, on cash access, will ensure that the FCA has regard to local access issues and a Government policy statement on access more generally. The Treasury will designate banks, building societies and cash co-ordination arrangements to be subject to FCA oversight on this matter.

Emma Hardy: rose—

Richard Fuller: I am afraid I am going to conclude.
This is a significant Bill and I look forward to the House considering each measure in detail as it makes its passage through Parliament. The Bill has a single vision: to tailor financial services regulation to the UK’s needs, to promote global competitiveness and innovation, and to contribute growth in our economy. I commend it to the House.

Several hon. Members: rose—

Rosie Winterton: Order. Before I call the shadow Minister, I want to point out what is probably obvious, which is that this debate is very well subscribed. I hope that, in considering their speeches, right hon. and hon. Members will bear that in mind.

Tulip Siddiq: I thank the Minister and his officials for all the information about the measures in the Bill that they have shared in recent weeks and for how they have co-operated with me.
As the Minister said, the Bill implements the outcomes of the future regulatory framework review and attempts to set out a clear direction of travel for the regulation of the City post Brexit. It is important that the UK is able to take advantage of this opportunity to create a more competitive financial services sector and to strengthen our regulatory standards for financial stability and consumer protection outside the UK. After more than a decade of stagnant growth, averaging just 1.8% a year, and with  the current dangers that face our economy, enabling the City to thrive will be fundamental to the delivery of the tax receipts we need to fund public services and support people through the cost of living crisis.
We on the Opposition Benches broadly support the Bill as it stands. In particular, we welcome clauses 1 to 7 and 8 to 23, which empower the UK, the FCA and the PRA to tailor regulation to meet our needs outside the EU. The Labour party recognises that the City is now in a place very different from where it was in 2016. The consensus view across the sector now is that the ship has sailed on regulatory equivalence with Europe, but regulatory divergence with the EU has the potential to produce many opportunities for the sector and the wider economy, such as the reform of Solvency II to unlock capital for investment in the green transition.
EU regulation can often be over-restrictive, particularly in respect of financial technologies, as the Minister will know, and we welcome the fact that the Bill enables regulators to take a more outcomes-based approach to areas such as fintech. However, Europe will always remain an important market for our financial services sector. In 2021, exports of financial services to the EU were worth £20.1 billion—that is 33% of all UK financial services exports.
Since 2018, the value of UK financial services exports to the EU have fallen by 19% in cash terms, and there has been little progress in securing trade deals for our financial services around the world. I have to say to the Minister that the sector is disappointed that the Government have so far failed to finalise a memorandum of understanding on regulatory co-operation, or to negotiate with the EU for the mutual recognition of professional qualifications for our service sectors. I hope that when the Minister sums up he will tell us what impact he believes the Bill will have in securing those important agreements with the EU and boosting financial services exports more generally.
The Minister will know that I like to ask a series of questions when I deal with him, and I am afraid there is more to come. Let me turn to clause 24. We support the principle that there is a role for the FCA and PRA to advance international competitiveness and growth. We on the Opposition Benches are strongly committed to supporting the City to retain its competitiveness on the world stage and to ensuring that the UK remains a global financial centre outside the EU. But it is also right that financial stability and consumer protection remain the priority for regulators. Any compromise on those important objectives would be self-defeating.

Caroline Lucas: I completely accept the hon. Lady’s point about our being a competitive financial centre, but does she agree that there is a real opportunity to be a competitive green financial centre? As that opportunity is time-limited—other countries are moving faster than we are—does she agree that a secondary objective in respect of climate and nature will be essential to ensure that we regulate in a way that allows us to make the most of that potential?

Tulip Siddiq: I thank the hon. Lady for her intervention. I will come on to that issue later in my speech. It felt as though Conservative Members did not agree with her, but I agree with what she said.

Wera Hobhouse: Further to the previous question, does the hon. Lady agree that one does not exclude the other?

Tulip Siddiq: rose—

Wera Hobhouse: I am referring to competitiveness and having a green agenda.

Tulip Siddiq: I had to think for a second about what the hon. Lady was referring to, but she is absolutely right. I agree with her on that, and I will address it a bit later in my speech.
The Opposition particularly welcome the inclusion in the new secondary objective of a focus on the medium-term and long-term growth of the UK economy. Financial services are already an important driver of growth in the UK, but much more can be done to support the sector to invest in companies in every sector and every region in the country, to deliver long-term growth and well-paid jobs in the real economy. I understand that clause 26 requires the PRA and FCA to report annually on the new secondary objective, but will the Minister confirm in his closing speech whether that will include being held to account specifically on the advancement of long-term growth in the real economy?
That brings me on to the provisions in clauses 27 to 46, which deal with accountability more broadly. The Bill facilitates an unprecedented transfer of responsibilities from retained EU law to the regulators. We recognise the need for a rethink of how the FCA and PRA are held accountable by democratically elected politicians and Governments. We particularly welcome clause 36, which will formalise and strengthen the role of the Treasury Committee in holding regulators to account. However, as my hon. Friends the Members for Wallasey (Dame Angela Eagle) and for Kingston upon Hull West and Hessle (Emma Hardy) said, we need to be able to scrutinise decisions taken by the Treasury, and I hope the Minister will elaborate on that. Any new powers allowing greater involvement of and policy input from Government in the FCA’s and PRA’s rule making process must be carefully balanced with the need to protect their regulatory independence. We will be scrutinising these provisions closely in the weeks ahead.
The UK’s reputation for regulatory independence is a key driver of our competitiveness on the world stage, as I am sure the Minister will agree. Equally important, however, is ensuring that the City has a clear direction of travel on post-Brexit reform. I was worried about that, because over the summer the now Prime Minister made a series of off-the-cuff policy announcements and people around her were spreading rumours, which left the sector in a state of uncertainty about her Government’s plans for this Bill. The Minister has today confirmed that the intervention powers, or so-called call-in powers, will be included in the Bill through an amendment. I am disappointed that the Government have decided to cause greater uncertainty in the City by introducing a significant change at this stage, and I hope he will reassure me that they will publish the details of these new powers as soon as possible. I would also be grateful if the Minister would confirm in his closing remarks whether the Government have plans to abolish the FCA and PRA. That would seem to undermine many of the provisions in the Bill.
I also wish to discuss the issue of access to cash and banking services, which some Members have spoken about. The Opposition broadly support the Bill, but we are concerned that there are some serious gaps in it as it stands. Of course, we strongly welcome clauses 47 and 48, which will finally, after years and years of Government delay, protect access to cash. The industry, and particularly the major banks, should be applauded for coming together to help protect cash services at the end of last year, in advance of this legislation being put on a statutory footing. But the Bill does nothing to protect essential face-to-face banking services, which the most vulnerable in our society depend on for financial advice and support.
On this Government’s watch almost 6,000 bank branches have closed since 2015, and the “Community Access to Cash Pilots” report found significant overlap between those reliant on cash, estimated at about 10 million people, and those who need in-person banking support. Those without the digital skills to bank online, people in rural areas with poor internet connection and the growing number of people who are unable to afford to pay for data or wi-fi as the cost of living crisis deepens are at risk of being left behind. Banking hubs or other models of community provision, such as banking kiosks, will need to be part of the solution. These are spaces where dedicated staff can provide vital face-to-face support for those who need it, and tackle digital exclusion by teaching people how to bank online.

Siobhain McDonagh: Does my hon. Friend share my concern that although a great deal is offered by the hubs, they do not deliver? They certainly do not for those of us who live in cities, as people require the bank most days if they are dependent on cash, and they are just expected to get the bus.

Tulip Siddiq: I agree with my hon. Friend, and I have seen examples of that in my constituency, especially the parts where people are from lower socioeconomic backgrounds.

Jim Shannon: The hon. Lady is outlining the case on behalf of those who live in rural communities, who comprise about 50% of my constituents. A number of banks have closed in our constituency—I believe there have been 10 or 11. Each of those banks—Danske Bank, Ulster Bank and all the others—has made exorbitant profits. I am not saying that they should not make a profit, because they should, but their profits are so high that they could well keep their branches open to ensure that people who live in a rural area can have access. Does she agree with me on that?

Tulip Siddiq: I agree with the hon. Gentleman’s point, especially as regards constituents in rural areas. I hope the Minister will take on board the comments that are being made.
I was delighted to hear the announcement from the Cash Action Group this week that the sector will be launching additional banking hubs on a voluntary basis, but these services must be protected by legislation. Will the Minister kindly set out in his summing up when the Treasury will be publishing its cash access policy statement, and whether it will ensure that in-person services are protected under the legislation?
It is also disappointing that the Bill fails to address the growing problem of financial fraud. Labour fully supports clause 62, which enhances protection for victims of authorised push payment scams, but the Bill does nothing to strengthen fraud prevention. Under this Government, the amount of money stolen directly from the bank accounts of hard-working people and businesses through scams and frauds has reached an all-time high of £1.3 billion. That would be bad in a normal time, in the best of times, but it is especially bad when we are in the middle of a deepening cost of living crisis. This Government have completely failed to get to grips with modern fraud and scams, such as identify theft and online scams, which have seen people’s lives stolen and their economic stability put at risk.
The former Business Secretary, who is now the Chancellor of our country, was asked about fraud earlier this year. He dismissed it, saying that fraud and scams are not a part of most people’s everyday lives. That is breathtakingly out of touch. Why does he think that? It is shocking. Martin Lewis, the money saving expert, said at the time that
“denigrating the experience that people in this country have with scams, and the lives that have been lost or destroyed because of scams, is an outrage. And he must and needs to apologise if he has any shred of decency in him.”
We still have not received an apology from the Chancellor, but he can put things right by taking immediate action to rectify the amount of fraud and scams that people are facing. I ask the Minister to explain in his closing statement why his Government continue to fail to take fraud seriously and push responsibility solely on to the banks. The Bill ignores the fact that digitally savvy criminals are increasingly exploiting a range of financial institutions, such as payment system operators, electric money institutions and crypto asset firms, to scam the public. In his summing, can he also please explain why the Bill would only provide for the reimbursement of fraud victims who send money using the faster payment system, and why other payment systems have not been included? That seems baffling.
Another area in which I feel the Bill lacks ambition is support for the mutual and co-operative sector. While clause 63 contains some welcome and long-overdue provisions, such as enabling credit unions to offer a wider range of products, the Bill does little to address the outdated regulatory regime faced by credit unions, building societies and co-operative banks. We have seen numerous building societies threatened with demutualisation in recent years, while the number of mutual credit unions has plummeted by more than 20% since 2016. Unlike the USA and many other European countries, the UK is uniquely lacking in mutually or co-operatively owned regional banks. That lack of diversity in the financial services sector has had devastating consequences for financial inclusion and resilience, with many desperate families forced into the arms of unethical lenders. I have seen that first hand in my constituency, especially in Kilburn.
A clear first step in addressing this issue would be to require the Financial Conduct Authority and the Prudential Regulation Authority to have an explicit remit to report on how they have considered specific business models, including credit unions, building societies and mutual  and co-operative regional banks, to ensure they are given parity of esteem with other providers. I would be grateful if the Minister addressed that in his closing remarks—I recognise that I have asked many questions that I want him to answer.
Turning briefly to food speculation, Global Justice Now has brought to my attention concerns that the Government’s proposed reform to the position limits regulations under MiFID II have not been adequately assessed for commodity market speculation risks. I ask the Minister to provide some reassurance that these reforms will not adversely impact commodity prices, such as energy and food prices, in the midst of a cost of living crisis, and to explain what role the regulators will play in monitoring this.
Finally, turning to the points that have come from the Opposition Benches, it is striking how little the Bill has to say about green finance. We of course welcome clause 25, which formalises the responsibilities of the FCA and PRA under the Climate Change Act 2008—introduced, I remind the House, by the last Labour Government—but the Government promised much more radical action. Indeed, we were promised that the UK would become the world’s first net zero financial centre, but instead, we are falling behind global competitors.
A recent report from the financial services think tank New Financial revealed that the UK is a long way behind the EU in both share and penetration of green finance in capital markets. It is possible that the Minister has not read that report; I am happy to send him a copy. If he reads it, he will see that it says in black and white that the UK is behind the EU. It found that green finance penetration in the UK was at half the level of the EU, and roughly where the EU was four years ago. When the Minister closes, if he does not agree with me, will he please explain why nothing in this Bill commits the Government to introduce sustainability disclosure requirements, a green taxonomy plan, or a green finance strategy for the sector? If he does not agree with the report I have quoted, could he tell me whether it is wrong?
I look forward to debating and, hopefully, addressing these issues with the Bill when it is in Committee. Once again, I thank the Minister in advance for his closing remarks, which I am sure will give detailed answers to all the points I have raised today.

Rishi Sunak: It is a pleasure to contribute to this debate—albeit from a few rows further back than I had originally anticipated—and to follow the hon. Member for Hampstead and Kilburn (Tulip Siddiq). I start by paying tribute to my hon. Friend the Member for Salisbury (John Glen) for the fantastic work he did as the longest-serving City Minister to get this Bill into the fantastic shape it is in, where it is now admirably shepherded through Parliament by his very worthy successor, my hon. Friend the Member for North East Bedfordshire (Richard Fuller). I also pay tribute to the fantastic team of officials, led by Gwyneth Nurse, who have spent the best part of the past year preparing what is, I believe, the most radical and significant piece of financial services legislation that this House has seen in years, if not decades.
There is so much in the Bill to comment on that in the interests of time, I will briefly focus on three things. First, the Bill appropriately seizes the opportunities of Brexit to scrap retained EU law and move to an agile system of regulation that is tailor-made for the UK. Secondly, it reforms regulations to make sure that we support economic competitiveness. Lastly, it keeps the UK at the forefront of harnessing innovative technologies and makes sure that we keep pace in a fast-moving sector.

Peter Grant: Will the right hon. Gentleman give way?

Rishi Sunak: Not for now.
First, on Brexit, with the future regulatory framework, the Bill represents a significant move away from relying on retained EU law as a means of regulating the UK’s financial services sector. Clause 1 provides for a full sweeping away—a full revocation—of essentially all the retained EU law concerning financial services in the UK. This is radical and this is right. Indeed, it is what Brexit was all about and this Bill delivers it.
We will move appropriately to the Financial Services and Markets Act 2020 model where the Government set the overall policy approach and delegate the operational implementation of those regulations to the independent regulators. As my hon. Friend the Minister said this is the internationally respected gold standard for how to do this. I was pleased to hear the Minister comment on the call-in power, and I urge him and the Government to quickly bring forward the means for that power, because both my hon. Friend the Member for Salisbury and I believe it is the right thing to do. We talked about accountability earlier in this debate. It must be right for a democratically elected Government, with the consent of this House, on an exceptional basis, to intervene on financial regulation in the public interest, and I hope that the Government will follow through with those plans.
On what this Bill does to support competitiveness, for the first time, our financial regulators will have a new statutory objective to support international competitiveness and growth, moving us in line with jurisdictions such as Australia, Singapore, Japan and Hong Kong. There will be new statutory panels to give better external scrutiny and challenge on the regulators’ cost benefit analyses. We heard much about the Markets in Financial Instruments Directive over the past several weeks and I am pleased that the Bill brings forward those reforms to MiFID: to remove restrictions such as the double volume cap when trading in wholesale capital markets to improve pricing for investors; to modify the transparency regime in fixed income and derivatives to remove unnecessary burdens; and to modify the commodities position limits so that market activity is not unreasonably restricted.
There are three areas on which I urge the Government to consider going further than I think we heard in the Minister’s opening remarks. First, to improve the efficiency of capital markets raising, there is an opportunity to reform European regulations in the prospectus directive. I hope the Government will bring forward draft statutory instruments for us to consider during the Bill’s passage. Secondly, the European packaged retail and insurance-based investment products directive is ripe for reform. I suggest repealing PRIIPS and replacing it with a tailor-made  regime specifically for UK markets. This will eliminate a counterproductive regulation, broaden the range of products available for UK investors and, indeed, increase UK retail participation in our financial markets.

Nick Smith: Does the right hon. Gentleman think that the Bill sufficiently challenges the Financial Conduct Authority to speak up and support consumers?

Rishi Sunak: Yes, I do: the Minister touched on provisions that increase consumer protection. My hon. Friend the Member for Salisbury spent a lot of time ensuring that consumers would have that protection, particularly with regard to scams, as the Minister outlined in his opening remarks. That is an area that needs attention.
Thirdly, on ringfencing, I suggest that the Government not only accept the recommendations of the independent Skeoch review, but consider going further. I know that this is a Government with a deregulatory zeal for growth, so I suggest two areas in particular: first, to review the threshold limits, which have not been looked at since they were initiated; and secondly, to take a fundamental look at the ringfencing regime in light of the fact that it was established after the financial crisis and that we now have a full stand-alone resolution regime.
It is worth recalling that more than half of Europe’s fintech unicorns are based in the United Kingdom, so it is important that the Bill continues to support innovation. I am pleased that it does so in two specific areas. It builds on our pioneering and world-leading regulatory sandbox to include the opportunity to pilot new sandboxes for distributed ledger technology in financial market infrastructure. That has the potential not only to lower costs and improve efficiency, but to improve financial stability. I am glad that the Government are also proceeding to bring stablecoins into the payments legislation, because that will create the conditions for stablecoins issuers and service providers to operate and grow in the UK.
I ask the Minister and the Government to consider implementing all the fantastic ideas that were contained in the speech by my hon. Friend the Member for Salisbury in April regarding blockchain and crypto, notably proceeding with a sovereign gilt issue using distributed ledger technology, but also enabling the trading of exchange-traded notes on crypto on UK exchanges, where we risk falling behind Europe if we do not act.
Why does all this matter? It matters for three specific reasons. The first is jobs. The industry provides more than 1 million jobs, and not just in London and the south-east; two-thirds of those jobs are in places such as Southampton, Chester, Bournemouth, Glasgow, Belfast, Edinburgh and Leeds. It is incredibly important. Secondly, it is one of the most important industries for our economy in terms of contribution to our GDP and tax revenues, and it is something that we as a country are genuinely world-class at. There are only a handful of industries where a country can say that, and financial services is one of those for us. It deserves the support of hon. Members on both sides of this House to ensure its continued success.
Lastly and most importantly, this Bill serves as a template for what the Government want to do across the rest of their business. It takes advantage of the opportunities of Brexit, radically reforms our regulations  to support innovation, growth and investment, and, although I would like the Government to go even further, it has my full support.

Peter Grant: It gives me pleasure to speak on this Bill on behalf of the Scottish National party. I am going to agree with the former Chancellor, the right hon. Member for Richmond (Yorks) (Rishi Sunak), for the first and probably the last time in either of our careers, in placing on record my thanks to his colleague the former Economic Secretary to the Treasury, the hon. Member for Salisbury (John Glen), for the constructive and courteous way in which he conducted a large number of debates with me during his time in office.
When the SNP decided to table a reasoned amendment asking the House not to give this Bill a Second Reading, we did so with a significant degree of reluctance, because there is a lot in the Bill that we see as not only desirable, but essential and, in some cases, long overdue. It is disappointing that the Government have chosen to package them with other provisions that give us very serious concern, and to package them in such a way that it will probably prove to be impossible to amend the Bill to take out the damaging parts.
For example, we welcome the provisions relating to the regulation of digital settlement assets or cryptocurrencies and on access to cash—we would have welcomed them several years ago, if the Government could have been bothered to bring them in. Our only real concern is that they do not yet go far enough. However, the dangers posed by other more substantial parts of the Bill are so great that they may be too high a price to pay to get those necessary pieces of legislation on the statute book.
In the Queen’s Speech we were promised a Bill that would,
“strengthen the United Kingdom’s financial services industry, ensuring that it continues to act in the interest of all people and communities”.
This Bill does not do that. In fact, the former Chancellor has confirmed what the Minister strongly hinted at: the Government’s main objective here is to force through a damaging, totally unnecessary divergence from our European Union neighbours, for no other reason than that they can.
The very first sentence in clause 1, which the former Chancellor thinks is a great idea, invites us to wipe out well over 200 pieces of legislation with no idea what will replace them. The Bill gives the Treasury the power to decide when and if each of those 200-plus laws is revoked and the Treasury gets the power to decide when, if ever, it will bring forward replacement legislation for them. Despite the Minister’s apparently not understanding our concerns earlier on, if that is done through secondary legislation in delegated legislation Committees, there will be no opportunity for the House to amend it, to make it better or to insist on legislation’s coming forward if the Government do not want to bring it.
The Bill gives the Treasury the power to amend or revoke Acts passed by this whole Parliament, and to revoke laws passed under devolved authority by the  elected national Parliaments and Assemblies of three quarters of the supposedly equal partners in this Union. A Treasury whose Ministers were appointed by a Prime Minister who got the first-choice votes of 14% of her own Members of Parliament will be allowed to overrule Parliaments elected on a franchise of more than 8 million citizens. How can that be anything other than an unacceptable power grab? That is because of the Government’s obsession with purging our four nations, even those that wanted to stay in, of anything that they regard as tainted by contact with the European Union.
There has not been any attempt to sift the 200-plus pieces of retained EU law to identify which are helpful and necessary and which are potentially damaging. If it has an EU tag, it has to go. There is even a sweep-up provision in part 5 of schedule 1 that says that if they discover any other EU legislation hiding somewhere that was missed from the schedule, that will automatically go as well. We have literally been asked to agree to revoke legislation that none of us knows is there. Even the people who drafted the Bill do not know what that legislation might say. That would be a gross abdication of our responsibility as Members of Parliament.
I find it comical that barely 24 hours ago the sacked Prime Minister was still spouting nonsense about getting Brexit done. Now we are told that not only are there hundreds of bits of Brexit that have not been done yet—and that is only in financial services and markets—but that no one knows where they all are, how many there are or what they say. Brexit has not been done by a long chalk.
Turning to the specific powers in other parts of the Bill, we generally welcome the new regulatory powers and related matters in part 2, but the Minister will appreciate that we will want to look closely at the detail in the Bill Committee. I am concerned that the Committee will be pushed for time, despite the number of days that it has been allocated. Members will be well aware of concerns I have often raised about the inadequacies of the Financial Conduct Authority’s powers and resourcing, as well as its reluctance to use the powers that it has.
The Labour spokesperson mentioned the lack of effective anti-fraud measures in the Bill, which is a major concern. Financial fraud and scams are becoming a bigger menace every day, and they hit hardest the people who can least afford to be hit. Something I have noticed about a lot of the financial scams I have looked into on behalf of my constituents is that they have features that are not immediately obvious. They often involve company directors effectively soliciting loans from the general public in order to finance their own investments. Rather than put their own money at risk, they put someone else’s money at risk. If the investment goes well, the directors win; if it goes badly the victims lose and the directors walk away Scot free. That was an obvious feature in the Blackmore Bond scandal, but exactly the same thing happened with Safe Hands funeral plans. Safe Hands appeared to be a funeral plan scam, but that was not the case. The company blatantly lied to its customers about how their money would be safeguarded, and it used it to invest in potentially profitable but high-risk offshore investments. Although it appeared at first glance to be a funeral plan, Safe Hands was in fact a good old-fashioned financial services scam.
When Safe Hands was on the way down, regulations were coming into force that meant that funeral plan providers had to be registered with the Financial Conduct Authority, which I warmly welcome. However, we should provide the same degree of regulation and the same protection to customers for other “pay now, collect later” schemes. If a customer gives their money to a company that blows it and they lose their money, it does not matter whether they thought their money would fund at some future date the cost of a funeral, a wedding, their children going to university, or anything else. The risks are the same and the opportunities for fraud are the same, so the protection offered to customers should be the same in all those schemes.
We should not have to go through measures industry by industry picking up where scams take place. The key point is that it is not about the product or service that the company claims to be selling—it is about making sure the customer’s money is kept safely until the time comes for that product or service to be provided. We should legislate to prevent company directors from gambling recklessly with money that belongs to their customers. It is possible to address this with a fairly simple amendment to proposed new section 71K of the existing Act, and I hope to have an opportunity to table that in Committee.
There is more that we could do with a bit of imagination. I like the idea of designated activities as well as regulated activity—that is a positive step. There are ways that we could significantly improve the accountability of companies carrying out designated activities and, importantly, improve enforcement against those that go rogue. We could reduce the exemptions that they have, which many of them abuse to avoid having to produce meaningful financial statements. We could look at extending the circumstances in which directors of high-risk companies can be held personally liable for their faults.
I realise that the disjointed way that the UK regulates businesses means that those things fall under the remit of the Department for Business, Energy and Industrial Strategy rather than the Treasury, so it may not even be competent to introduce them for consideration in Committee, but I ask the Minister and his BEIS colleagues to find a place in the Government’s legislative programme as soon as possible for these things to be considered. Too many directors of dodgy companies carry on with their scams because they think they can get away with it, and far too often they can.
As the Minister knows, because he responded to the debate, I spoke this morning in Westminster Hall about the regulation of cryptocurrencies. Incidentally, that is a good example of the fallacy in one of the arguments that the Minister advanced earlier. When we are talking about businesses, growth and stability are not the same thing. Some cryptocurrencies had almost supersonic growth and then evaporated. They had high growth but no stability whatsoever. Growth and stability may both be desirable—although, as the hon. Member for Brighton, Pavilion (Caroline Lucas) keeps reminding us, there have to be conditions attached to that growth and it has to be sustainable—but to conflate the two is a serious mistake.
The debate on cryptocurrencies is a useful reminder that the way that financial markets operate is changing at an almost bewildering rate. In fact, it is becoming difficult to define exactly what we mean by financial services and financial markets. The Bill makes provision  for the Treasury to allow limited testing of new technologies or practices. It is effectively trying to legislate for things that have not been invented yet. I think the approach taken in clauses 13 to 17 is a sensible way forward, but we will be looking very closely at how the use of those powers is scrutinised. For example, Members should be aware, if they are not already, that clause 15 as currently worded will allow the Treasury to amend certain Acts of Parliament on the basis of a pilot test in one of the sandboxes without even waiting for the test to be completed to see what the results are.
Let me move on—briefly, because I am aware of the shortage of time—to some of the other matters covered by the Bill. I am extremely alarmed at the confirmation that the Government want to allow Ministers to call in and potentially overrule decisions by the regulators. Either our regulators are independent or they are not. The regulators must be accountable, but their accountability should be to Parliament. Accountability to a Minister is not the same as accountability to Parliament; it is a very poor substitute.
I share the concerns that have been raised about the lack of emphasis on sustainability, green finance and compliance with our climate change obligations. I also share the concerns that the provisions on access to cash do not go far enough and probably will not lead to action quickly enough. As I mentioned, the anti-fraud measures in the Bill are wholly inadequate.
The Government appear to think that the biggest problem facing financial services regulation is that parts of it were designed and implemented in partnership with our nearest neighbours and trading partners. I think the biggest problem is that, again and again, the regulators fail to act, or act so slowly that it is far too late, and effective enforcement becomes almost impossible. I remind the House that about half of the £46 million lost in the Blackmore Bond scandal was paid by customers to the company after the Financial Conduct Authority had been not only given full details of what the company was up to, but told exactly where and when it could go to witness its illegal activities at first hand. It did nothing for three years.
The Financial Conduct Authority tells us that it does not have sufficient powers to act in the way we would like it to act. It is certainly obvious to all of us that it does not have the resources to properly carry out the responsibilities we ask it to carry out just now, let alone the new ones we intend to give it. At the moment the Bill does not address that.
We will not oppose Second Reading this evening, but that should not be taken as a guarantee that we will allow the Bill to be read the Third time unopposed. If the Minister wants our support in the Bill’s final stages, he has a long way to go to persuade us that it will make things better, rather than worse, for the victims of financial crime.

Eleanor Laing: I call the Chair of the Treasury Committee, Mel Stride.

Mel Stride: I rise to broadly support the Bill. I echo the congratulations of my right hon. Friend the Member for Richmond (Yorks) (Rishi Sunak) to my hon. Friend the Member for Salisbury (John Glen) on all his work, and I thank him for his  appearances before the Select Committee in that regard—he probably bears the scars. I also welcome my good friend the Minister to his place and I thank him for setting out the Bill’s provisions with such clarity in his opening remarks.
The Bill occurs because of Brexit—because of the opportunities and the new freedoms that we have as a consequence of leaving the European Union. We have heard much about solvency II in this debate and more widely when we have discussed the new regulatory landscape that we are moving into. My right hon. Friend the Member for Richmond (Yorks) presented us with a rich tapestry of additional ideas about where he believes that the Government can go still further, which makes me feel that we should perhaps have him before the Treasury Committee again to tell us more about that; that might be a recurrent nightmare for him, however, so perhaps we will not inflict it on him at this moment.
With that greater freedom comes the critical issue of scrutiny by Parliament and by Government. When it comes to scrutiny by Parliament, I believe that the Treasury Committee is and should remain right at the centre of that process. We are moving from a bureaucratic, committee-based process within the European Union that literally goes through regulation line by line. It is important that it does that in the context of what were 28 member states, because an element of negotiation is involved at every stage of the scrutiny of those regulations. We are in a different environment now; we can be much more flexible and nimble, but we still need to be effective in that regard, which is why the Treasury Committee should be at the heart of that process.
As has already been mentioned, we have set up a Sub-Committee that will look specifically at regulation as it comes out of the statute book and cascades down to the rulebooks and manuals of the regulators. We believe that we can be selective, nimble and appropriate in the way that we address that. The Sub-Committee will have the same powers as the full Committee to send for persons and to have oral hearings. In fact, we have already had our first hearing into the Prudential Regulation Authority’s work around the strong and simple regime for the lighter-touch regulation of firms that do not come anywhere near the threshold for being potentially systemically important within the sector. In terms of staffing and resources, the Sub-Committee has the ability to, and will, take on additional resource by way of expert assistance, and it has the capacity to gear up and gear down as necessary, depending on the workload that comes its way.
I noted the Minister’s comments about the statutory duty that will come in for the regulators to inform the Select Committee when a review is published, and for the regulators to respond to its various consultations as they occur. I suspect that the Select Committee will look at some possible amendments to that, because we will be particularly interested in making sure that we have the power and authority at the centre of this process to effectively carry out the things that we need to do in that area.
I turn to the Government’s powers of scrutiny in the Bill, which touch on the balance between the independence of the regulators and the importance of holding them  to account, particularly in terms of seizing the opportunities of this post-Brexit world. Prior to the Minister’s opening speech, my understanding was that there would be—as there is in the current Bill—a requirement that the regulators could be instructed by the Treasury to review rules on the basis of a public interest test and, in particular, where there had been significant market developments or where the rules were not meeting their requirements or purpose. It was to be used only in exceptional circumstances. At that point, if a review were held, as I understood it, it would not have been incumbent on the regulator to make any particular changes.
I think I heard the Minister say earlier, however, that an amendment will be tabled in Committee to allow the Treasury to have the power to direct the regulators to make changes, which is a significant shift. I know that that was welcomed a moment ago by my right hon. Friend the Member for Richmond (Yorks), and I understand the upsides of this. I think it is important that regulators are held to account, particularly when it comes to our competitiveness and so on. However, the questions arise: what is the threshold for this public interest test and how frequently will it be used? The fear must be there to some degree—this is something the Committee will want to look at very carefully—that this may be an overly overbearing power for the Treasury, which may impinge on the independence of the regulators themselves.
The Bill has the new secondary objectives for the FCA and the PRA, which I broadly welcome. I welcome the fact that they are medium and long-term objectives, not short-term objectives. I think that is very important because it means we are not going to take risks with the potential architecture, as it were, but focus on the medium and longer term when it comes to greater competitiveness. I also welcome the fact that they are secondary objectives and will not therefore interfere directly with the prudential objectives of those organisations.
Finally—I am aware of the time and know that many others want to speak—could I touch on the Bank of England and its mandate? I know that the Bank of England’s remit or mandate does not feature directly in this Bill, but much has been said about it and the importance of its independence, and I want to underscore that importance in this debate. There was a period, going back some weeks and months, when perhaps because, understandably, many Members and those who are now in government may have looked at the Bank of England and said that, because inflation is so far adrift from its target of 2%, it is therefore entirely unfit for purpose. I do not subscribe to that view. I do not believe that the Bank has been perfect, but I think it has faced extraordinary situations that have made its ability to keep inflation down to about 2% really a task that no central banker could have achieved.
It will be vital that the Bank of England maintains its independence, that politicians are kept out of monetary policy and that Chancellors do not determine interest rates if we are going to have a credible approach to monetary policy and all the benefits that brings. As my right hon. Friend the former Chancellor has said at the Government Dispatch Box on occasion in the past,  if we take a 20-year view of the Bank of England’s performance, it has actually been spot-on at about  2%. Perhaps I can leave this debate with the thought that we must guard the independence of the Bank of England.

Several hon. Members: rose—

Eleanor Laing: Order. It will be obvious to everyone in the Chamber that a great many Members wish to speak and that we have limited time. However, we do have quite a lot of time, so I will have to put on an official time limit of seven minutes, but not quite yet. After the next speaker, who has had no notice of this, there will be a time limit of seven minutes.

Seema Malhotra: Thank you, Madam Deputy Speaker, for the opportunity to speak in this important debate about these very significant issues of structural reform in our financial services, the accountability of our regulatory bodies and consumer protection. I am pleased that we have started to have some debate on the net zero policy and regulatory principle, and I want to endorse all the points made by my hon. Friend the Member for Hampstead and Kilburn (Tulip Siddiq) in her important opening speech on green finance. Unfortunately, the Bill does fall short of what I believe is needed to protect consumers, and I want to speak about three key areas: first, access to cash; secondly, and briefly, mutuals and co-operatives; and thirdly, action for mortgage prisoners.
First, access to cash is an issue on which I have spoken before and led debates in Westminster Hall. It is right—finally, we can all be very pleased—that the Bill aims to protect people’s access to cash and will introduce a legislative framework to ensure the continued provision of cash withdrawal and deposit facilities. I want to recognise the work that has been done by Access to Cash Action Group members, which have worked very hard on this issue, including Age UK, Toynbee Hall and banks such as HSBC, NatWest and Nationwide. It is a really important network, and it is right that they are taking steps voluntarily, but it is also important that there is an underpinning of legislation to back those steps. Indeed, the failure to act fast enough has cut millions of people off from a range of important vital services.
Last year I presented a petition to Parliament on behalf of constituents in Hounslow West in the light of the closure of the local Santander Bath Road branch. Since then, we have lost two more branches of Barclays in Feltham and Heston, leaving even more of my constituents without access to in-person banking services. I pay tribute to some of our local councillors—Councillors Bandna Chopra, Jagdish Sharma and Hina Mir—for raising this issue in their local wards, but the standard response we received from the banks was just not good enough. Around 6,000 bank branches have closed since 2015, yet the Bill does not seem to do anything to protect essential face-to-face banking services. It also makes no commitment to free access to cash—I was surprised that the Minister did not take the opportunity to confirm his commitment to that. It is important that the definition of the minimum distance between cashpoints is brought forward earlier, and I do not understand why the Minister cannot clarify the Government’s position on that. Surely he must have a point of view.
I am a Labour and Co-operative party MP, and it is staggering that the number of mutual credit unions has plummeted by more than 20% since 2016. If we have learned anything from the pandemic, it is the importance of community and community solutions in our local and public services. Although the Bill contains some welcome and long-overdue provisions, such as enabling credit unions to offer a wider range of products, the Government’s plans for the sector could be far more ambitious, and I wonder whether we could work cross-party on that issue. Labour has demonstrated an ambition to boost the size of the co-operative and mutual sector, and there is demand for that across the country.
I am a member of the Financial Inclusion Commission, and there is a slight frustration—or perhaps a bigger frustration when we consider the issues raised by Members across the House—that the Bill does not seem to prioritise financial inclusion as much as is needed, particularly given the cost of living crisis that we are now facing. In that context, I wish to raise the issue of mortgage prisoners. The Bill provided a vital opportunity for the Government to act to ensure that financial regulators are stronger in their ability to help mortgage prisoners. The UK’s 195,000 mortgage prisoners took out their mortgages prior to the financial crisis, with fully regulated high street banks such as Northern Rock. They were kept trapped on high standard variable rates, before their mortgages were sold by the Government to mortgage loan sharks such as Cerberus, Tulip and Heliodor. They cannot switch to different lenders.
As co-chair of the all-party parliamentary group on mortgage prisoners, I have heard from key workers, many of whom risked their lives to work through the pandemic, about the personal consequences for them and their families of being trapped into paying high mortgage interest rates. Imagine how it must feel to be a nurse who took out a mortgage with a high street bank, only to find that their mortgage was sold on by the Government to a vulture fund that does not have to treat them fairly or offer them a good deal. Those mortgage prisoners are suffering financial devastation from interest rate rises to their already high standard variable rates, and that comes on top of the pressures of rising energy bills and the cost of living crisis.
One of my constituents is a mortgage prisoner whose mortgage was sold to Landmark Mortgages and is ultimately owned by Cerberus. They are stuck paying an SVR, and are not being offered any new deals. They have now seen a rise in the SVR from 4.39% to 5.89%, and they are therefore paying more than £9,000 more a year than they would if they were with an active lender. There is nothing they can do to gain any certainty over their mortgage payments. Many mortgage prisoners are terrified at the prospect of future interest rate rises. Prior to the financial crisis, the gap between the Northern Rock SVR and the base rate was 2.09%. Since 2009 it has been more than 4% above the base rate.

Kevin Hollinrake: The hon. Lady is making interesting and key points about mortgage prisoners. At the time those loan books were sold, UK Asset Resolution made commitments to the Treasury Committee that those people would still be able to access market and fixed-rate deals, but that has not proven to be the case. It is very difficult for the Committee to get those kinds of assurances without having confidence that those assurances would be valid.

Seema Malhotra: I thank the hon. Member for his contribution and for his work for the all-party parliamentary group on mortgage prisoners. He is right, and those commitments need to be taken forward. It is surprising that there has not been more push on that from the Government.
The Government and the FCA have tried to claim that mortgage prisoners are not overpaying but paying similar SVRs to others in the market. However, that comparison is meaningless, because only 10% of customers of active lenders are paying an SVR, and many can typically switch to a new deal quickly. More than three quarters of consumers with active lenders switch to a new deal within six months of moving on to an SVR, but mortgage prisoners have been stuck on high SVRs for more than 10 years.
The all-party parliamentary group on mortgage prisoners has proposed two options that would provide mortgage prisoners with immediate relief by capping the high SVRs that they pay with inactive lenders and ensuring that they are offered fixed rates by their existing lenders. That would provide immediate relief to all 195,000 mortgage prisoners. Martin Lewis has supported a cap on SVRs for mortgage prisoners at inactive lenders, and organisations such as Surviving Economic Abuse also support that action.
The Government say that that would be an unprecedented intervention in the market, but the truth is that there is no market and there is no competition. It is the Government’s fault, because they sold these mortgage prisoners on to vulture funds, who are not treating them fairly. The APPG’s proposals are a targeted intervention and would have no impact on the wider market of active lenders such as the main high street banks who compete to offer new deals to their existing customers.
Although I support much in the Bill, there is much to clarify and improve and there are enormous gaps that need to be addressed. These reforms are important and urgent. I will be happy to meet the Minister to discuss mortgage prisoners with the APPG, should he find that helpful. I will listen closely to his response.

Several hon. Members: rose—

Eleanor Laing: We now have a formal time limit of seven minutes, but that is likely to be reduced later in the day.

Damian Hinds: I welcome this ambitious piece of legislation. It is quite right that for a country and an economy such as ours, in which financial services play such a key role, we should be able to set UK-specific financial services regulation. I very much welcome the reframing of the regulatory objectives around long-term growth and international competitiveness. I want to speak to two specific aspects of the Bill that fall under “other miscellaneous provisions” but are nevertheless incredibly important: credit unions and compensation for the victims of fraud.
I turn first to credit unions, and in particular their role in financial inclusion and providing an alternative to high-cost, sub-prime lenders. Last night, I happened to be flicking through a well-thumbed copy of Hansard and looked at a debate from January 2014—hon. Members  will remember it—when we were discussing payday lenders and the problems associated with them. We have come a long way since then. I think it is important sometimes to look back and say, “Where has regulatory change made a big difference?” We have had: the CMA report; the new FCA regime, including on payday affordability checks, roll-overs and restrictions on advertising; the measures on continuous payment authority, which I remember the hon. Member for Walthamstow (Stella Creasy)—no doubt, she would have wanted me to say this—championing so strongly; the cost of credit cap; and, most recently, the new FCA consumer duty.
More broadly, the Government put financial education on the national curriculum and, of course, supported credit unions with a commitment of up to £38 million for their development and further regulatory liberalisation.

Stella Creasy: I acknowledge what the right hon. Gentleman is trying to point out. However, does the evidence not show that it was the intervention of the financial ombudsman service that led to the downfall of companies, such as Wonga and Amigo, that were exploiting our constituents, rather than the intervention of the FCA, which oversaw unaffordable lending on its watch? Does that not show us why we need further FCA reform? It is the opposite of the point that he is making.

Damian Hinds: The hon. Lady makes an important point. It would be wrong—I am sure she did not mean to say it, even though it is what she just said—to say there was a single cause for those things. In fact, it is about changing the entire framework. In other parts of the market, for example home credit, there is a different set of reasons again why there has been a decline. We know the sub-prime segment shapeshifts the whole time, and we have also seen the recent growth of buy now, pay later. At a time of heightened financial stress, it is inevitable that new risks and new vulnerabilities manifest.
Wise heads always remind us that in seeking to curb the parts of the high-cost lending market that we do not like, there is always a danger that we instead push some part of that customer base into the arms of a high-cost lender whose idea of a late payment penalty is a cigarette burn to the forearm, so we must get the balance right. Regulation has been a success, but ultimately what we need is an alternative, because credit does form a part of people’s lives, and that is where credit unions and others, such as community development financial institutions, come into play.
We have seen development in the sector, but I would like to see a lot more. We have a great example in Northern Ireland—and indeed in the Republic of Ireland—of what a much more developed credit union sector can look like, and I would like to see that in mainland Britain. The proposals in the Bill will continue that development, amending the Credit Unions Act 1979 to allow for conditional sale and hire purchasing agreements to be undertaken by credit unions, along with the marketing of insurance services. I would only encourage the Government to go further, because our credit union sector is still small in Great Britain compared to Northern Ireland and there is much more that can be done. There is also more that can be done on CDFIs, whose growth, frankly, has been disappointing.
I encourage keeping an open mind on the regulatory aspects of the Bill. I do welcome the measures, but while the 3% per month interest cap is very reasonable, in some parts of financial services it is difficult to break even on that cap. Ironically, the demise of the market leader of the home credit business sector makes it more urgent for us to ensure there is very good provision from credit unions and other responsible lenders in its wake.
The other issue I want to comment on briefly is the provisions on authorised push payment scams and mandatory reimbursement. This gives me the opportunity to join others in the nice things they have been saying about my hon. Friend the Member for Salisbury (John Glen), the former Economic Secretary to the Treasury. I had the opportunity to work with him when I was Security Minister and he was bearing down on the awful growth in fraud. We have not just seen that growth in this country. Fraud and economic crime have been growing in countries throughout the world. There is a change in crime, and we need to respond accordingly. I welcome the change in the Bill, because it brings consistency and fairness and will enhance confidence for people using online financial services. One should never take away all responsibility from the consumer, of course, but that is a welcome move.
Very briefly, there are two things I would like the Government to look at, one for the Treasury specifically and one for the wider Government. First, for the Treasury, it is not clear to me why this provision applies just to the faster payment system. It is true that the vast majority of scams happen through faster payments, but they may not in future. It is right that the regulator should have the ability at least to extend that scope.
Secondly, a bigger point—not for my hon. Friend the Economic Secretary, he will be pleased to know, but for others in Government—is that we should extend the principle beyond the banks. It is difficult to get sympathy for banks and bankers, but right now they are bearing the entirety of the burden even though they are just the last link in the chain of the scam. They have responded very well, partly through regulation on such things as strong customer authentication and so on, but also by going further off their own bat. I think that is partly to do with their moral commitment to their customer base, but it is also about the liability they face through the contingent model. One wonders whether, if social media platforms, telecoms companies and others had had those same incentives, we might already have a lower level of fraud than we have today.
Save for those two encouragements to my hon. Friend the Minister for the Government to look at going further, I strongly welcome the Bill and all he is trying to do.

Kate Osamor: Thank you for calling me to speak in this very important debate, Madam Deputy Speaker, and I associate myself with the remarks of my hon. Friends the Members for Hampstead and Kilburn (Tulip Siddiq) and for Feltham and Heston (Seema Malhotra). I welcome the Government introducing measures to protect access to cash, and I will use my speech to express my constituents’ concerns about that.
In Edmonton, between 2018 and 2021, a third of our free-to-use ATMs disappeared. I receive correspondence from my constituents telling me how the closure of banks and the lack of free ATMs is putting a strain on them. The importance of using cash on a regular basis is that it remains, for millions of people, simply the best way to budget effectively. Those facing digital exclusion or physical impediments, who are disproportionately elderly, will continue using cash.
I am not alone in saying this. The “Financial Lives 2020” survey found that around 2.4 million people aged 65 and over in the UK relied on cash to a great extent in their day-to-day life, representing around one in five—21%—of all older people. Also, small and medium-sized businesses, such as hairdressers, barbers and nail shops, survive off regular, frequent small cash transactions. I think about the small businesses in Edmonton, such as the nail salon or my hairdresser, Debbie’s, who did my hair for me—[Interruption.] Thank you. These businesses only take cash from customers. Small and medium-sized businesses simply cannot afford to run a card machine. Common charges include transaction fees of between 1% and 3% a sale, authorisation fees of between 1p and 3p a sale and merchant service fees of between 0.25% and 0.35%. Edmonton is one of the most cash-dependent areas in the country.
I welcome the measures to empower the Financial Conduct Authority to ensure that designated bodies must continue to provide “reasonable access” to cash, as I do the powers to potentially stop the closure of certain cash access points if there is no alternative nearby. However, to truly address this looming issue, we must acknowledge that attachment to cash has been much stronger in more deprived communities. Along with age, that is the greatest factor in its continued use.
Admittedly, rates of withdrawing cash have fallen off a cliff in wealthier constituencies, but during the covid crisis, cash withdrawals fell by only a quarter in less affluent areas. That figure would only increase if the free ATMs that have been removed were all replaced, but not with pay-to use machines. With a regular fee of £1.75 just to withdraw cash from a pay-to-use machine, it is a luxury that many cannot afford, yet the Bill makes no clear commitment to protect free-to-use over pay-to-use machines. The latter understandably have much lower usage rates. I hope that the newly appointed Chancellor will instruct the Treasury to differentiate between them clearly in its cash access policy.
We are also still waiting for the Government to define the meaning of “access to cash”. Without a clear maximum geographical distance between cash machines, we risk sleepwalking into a situation where cash deserts are commonplace. Also missing from the Bill is a provision to ensure that there is sustainable funding for free-to-use machines, which has seen serious strain recently. Providers must be compensated for providing this vital public service. Currently, we risk reaching a threshold whereby huge numbers of free ATMs become uneconomical and are forced to close. The funding model should also consider the demographics and economic deprivation in any area, which bears a strong relation to the need for cash access.
The Bill could be an important step in determining safeguards on access to cash in the long term, but sadly what we see is a narrow set of proposals with a lot of  detail still unconfirmed. In the meantime, there should be a pause on removing free-to-use ATMs. Otherwise, more of my constituents will be further excluded.

John Glen: May I say what a great pleasure it is to speak in this debate? It will be of little surprise to the House that I support many of the measures in the Bill—20 separate measures, I think, over 335 pages. I would like to make a few comments on the process that led to the Bill, some observations on the policy content and, if I may, a few suggestions about some areas in which the Government might consider going further.
It has been the greatest privilege of my political career to have been Economic Secretary to the Treasury for four and a half years. When I started in the role in January 2018, there was considerable ambiguity about the direction of Government policy. It feels a little heretical to say it, but there was great uncertainty about how financial services would land after the Brexit decision. There was no consensus, and there were significant predictions of the demise of the City of London. Over those four and a half years, I was very pleased—I am not saying that it was all my doing—to see the resilience of the City of London. The global hub of financial services in London has proved itself phenomenally resilient over the past three years.
After a lot of discussion about dynamic alignments and thoughts about how things should be delivered, we had an election and we had clarity. We had a new, clear direction, eventually resulting in this Bill, which takes us back to the gold standard of the FSMA model. I welcome that. I also welcome the fact that the Bill has come about through deep dialogue with the City and the trade bodies that represent the financial services industry. As my right hon. Friend the Member for Richmond (Yorks) (Rishi Sunak) says, it is a critical industry for our country: it generates 10% of our tax revenues. That is why the framework that we are setting out today is so important.
I pay tribute to Miles Celic at TheCityUK, to David Postings at UK Finance, to Catherine McGuinness and now Chris Hayward at the City of London Corporation, and to Huw Evans and now Hannah Gurga at the Association of British Insurers. They were instrumental in the constructive dialogue with Treasury officials to ensure that the policy that we arrived at met the needs of this complex industry. I thank them for their engagement during my tenure.
At the risk of being accused of Stockholm syndrome, I also pay tribute to officials at the Treasury. Over the summer, a lot has been said about Treasury orthodoxy and about regulators. I put it on record that my experience of working at the Treasury over the past four and a half years was that Treasury officials worked under the direction of politicians, as we would expect, but that they were also extremely eager to find creative solutions at a time when there was no template, no rulebook and no preordained way forward.
I pay tribute to the work of Sam Woods at the Prudential Regulation Authority. The PRA provides a distinct role from the one that we perform in this place, but the professionalism that it shows in dealing with  complex regulatory matters is something that we should be very grateful for in this country. I also want to speak about the Financial Conduct Authority, because the Bill will give the FCA and the PRA a significant degree of responsibility. As we put aside the retained EU law that we spent so much time in Committee sorting out, we now rely on them, under the growth and competitiveness objective, to come forward with new rules. We are not seeking to deviate from norms in other jurisdictions; what we are trying to do is rightsize those rules for the UK.
I want to say that I recognise that the implementation of the future regulatory framework has not come about on a whim, but has taken a great deal of work over a couple of years, along with a great deal of consultation. I also want to say that the EU legacy is not all bad. We in the UK played a significant role in shaping that legislation, and during my interactions with my counterparts when I was a Minister they were very complimentary about the role that we played, but—as my right hon. Friend the Member for Richmond (Yorks) pointed out—that does not mean that we should not now be courageous in taking opportunities.
The wholesale market review presents a phenomenal opportunity to make changes to MiFID. It is one of 30 reviews that we have undertaken in the Treasury over the last year to ensure that we get this right. What we are doing with clearing—the middleman in trading—is also critically important, because the central clearing counterparties in London are instrumental across the globe and will continue to be so. They are efficient, they are world class, and no matter what the EU may wish to do to compete with our clearing environment, we can be certain that the Bill will ensure that those standards remain very high. We have needed to embrace innovation, and the sandbox for which the Bill provides is an important function enabling the FCA to do that.
As we look to the future, we must think about our relationships with other countries that have significant financial services industries. We will need to customise those relationships, and optimise them. I am therefore pleased about the mutual recognition agreement enablement provisions. I welcome the call-in power, although clear principles must be set out in respect of how it is applied; this is not about a random political intervention. I also endorse the moves to deal with packaged retail investment and insurance-based products and get rid of key information documents, and to introduce something that is appropriate in the UK.
I welcome the Bill, and I pay tribute to my successor. I wish him as long a tenure as I have had.

Ronnie Cowan: I will not consume all my seven minutes. I shall try to give some time back to the House and allow others to speak. In any event, I am feeling absolutely lousy, and standing for more than three minutes may well prove to be a bit of a challenge.
The majority of people are using less cash. The technology which is available, and which we are encouraged to use, has seen cash acceptance and access to cash decline. For many people, including me, using a card or phone to pay for goods and services has become the norm. It is quick, it is convenient, it is practical—but it is not for everyone. As the cost of living has gone up, there is evidence that more people are turning to cash in  order to budget. The Post Office reported record withdrawals in July 2022, and a survey commissioned by LINK has indicated that 10% of people are planning to use cash more to help them to budget.
We are not talking small numbers here: more than 5 million people in the UK are already relying on cash, and—quite disturbingly—55% of respondents to a survey of 500,000 people conducted by Cardtronics felt pushed towards cashlessness against their will. We need a sensible strategy that does not discriminate against cash users, who tend to be the elderly and the most impoverished in our society. The Government must provide clarity about the content of their access to cash policy statement. There is no reference to ensuring free access to cash, which is an absolute must. There are no baseline geographic distances applying to withdrawal and depositing facilities. When communities apply for such services, there is no feedback to explain why an application was unsuccessful. This process should be transparent and clear.
I urge the UK Government to make the consumer’s interests their priority, and to produce a Bill that safeguards existing cash users and ensures that firms have complied with their own regulatory obligations. Honestly, how hard can that be?

Stephen Hammond: I was not expecting to be called quite so early in the debate, given the panoply of talent on these Benches and the Benches opposite. In the interest of brevity, I will briefly concentrate on three aspects of the Bill. First, I want to guide the House to my entry in the Register of Members’ Financial Interests.
This is one of the most significant Bills that this House is likely to look at in this Session of Parliament because, as the Minister has said, the realignment of the regulatory architecture offers a unique opportunity to become more nimble, more agile, more accountable—I hope—and more pragmatic in our approach to regulation. The most important parts of the Bill take forward the future regulatory framework. Requiring regulation to comply and to promote international competitiveness will address the widely held concerns that regulators have in the past used their powers narrowly and over-cautiously to reduce risk, thereby reducing innovation, increasing costs and decreasing consumer choice, which has overall been detrimental to competition.
Creating what is, let us be clear, a secondary objective of international competitiveness and growth is absolutely right. Having this objective in place will neither undermine the regulators’ independence nor cause any prospect of a financial crash. I also do not believe, as some have said, that it is in any way a push for the lowering of standards. The industry knows that proportionate and effective regulation by an accountable regulator is the key to international competitiveness. I was interested to hear the Minister say that he thought we in this House should look again at the accountability structures of regulators. I welcome this objective, and I also welcome the cost-benefit analysis panel, which again plays into the objective of ensuring a nimble, agile regime that protects consumers while taking up the opportunities post-Brexit.
However, with the secondary objective and the cost-benefit analysis panel, there is a concern that regulators must be accountable both to this House and to the Government, but in particular to this House. I welcome  the setting out in practice of some of the key performance indicators for the regulator and I recognise and welcome the Sub-Committee of the Treasury Committee, but I hope we will be able to discuss this in Committee and I urge the Minister to think about whether amendments are needed to include an obligation on the regulators to state how any new regulation will meet and further the objective of international competitiveness. I hope he will also consider an annual report, at least on the delivery of those objectives, which should include some measurement against specified key performance indicators. There should be no suggestion that the regulators are being allowed to mark their own homework.
I am sure that the Minister will clarify this later, but the cost-benefit analysis panel needs either to have external members—that must be explicit—or to make it clear that it is taking external advice. It ought also to be clear exactly what criteria are being used to measure cost-benefit analysis. Those measures would help considerably in terms of accountability. I do not believe that scrutiny and accountability affect the independence of either the PRA or the FCA. As my hon. Friend the Member for Salisbury (John Glen)—who I have had the pleasure of questioning in this House a number of times—knows, I want to see this industry thrive. It is key to the whole of the United Kingdom, because two thirds of the jobs in the industry are outside London. I think he too would accept that scrutiny and accountability do not threaten the regulators’ independence. They are important if we are to have a regime that continues to be internationally renowned.
I have been fortunate enough to be a member of the Treasury Committee in the past, and I hear entirely what my right hon. Friend the Member for Central Devon (Mel Stride) has said. However, I would suggest to him that as a result of the pressures on the membership of the Treasury Committee and the Sub-Committee—I accept that they have the same powers—caused by the extra work, we should open a debate on whether the House needs to think again about whether just having a Sub-Committee of the Treasury Committee is adequate, given the importance of this industry to jobs and growth across the country. I will ask the Minister, perhaps in discussions, to consider yet again a Joint Committee of both Houses on financial services, which is what happens in other jurisdictions.
I welcome so many measures in the Bill, but let me touch briefly on just one. Others will talk about the revocation of retained EU law and a number of other aspects about which Members have already spoken, but I urge the Minister to press ahead with mutual recognition agreements. They are another key way to ensure that the United Kingdom’s financial services remain at the forefront of global financial trade. It is extremely welcome that we are pressing ahead with Switzerland, but I urge the Minister to continue to press ahead with the powers that the Bill allows to be implemented and the regulators to give effect to. With those words, I warmly welcome the Bill, and I look forward to supporting it.

John Martin McDonnell: I hope there will be plenty of time to discuss the detail of the Bill both in Committee and on Report, so I wish to make some general comments on my worries about where it is situated. When J. K. Galbraith wrote about  the 1929 crash, his advice for the future was that people could set up all the institutions they needed to try to prevent it from ever happening again, but the greatest protection would come from memory. I therefore want to go back in time to some of the lessons that we perhaps should have learned but did not.
I wrote about the big bang in the 1980s and I can remember the concerns we expressed about a wave of enthusiasm for deregulation similar to what we see today. That enthusiasm resulted, in effect, in a casino economy. The City of London and the finance sector are the most successful lobbyists in the history of politics in this country and they are incredibly powerful. Sometimes, that results in corporate capture, not just of Governments but even of Oppositions at times. That period of enthusiasm for deregulation resulted in a casino economy that eventually resulted in a series of crashes—we endured not just 2007-08 but other crises.
I was in this House in 2007-08 and was the first Member to raise the issue of Northern Rock. I remember that in the debate after Northern Rock, the Treasury itself spoke about the “excessive concern for competitiveness” that brought about elements of that crash. I worry that we are re-inserting into legislation an emphasis on competitiveness that could override so many other issues of concern.
Here we go again. We are introducing legislation and placing in it a reliance on the structures that we established after the 2007-08 crash, particularly the FCA. I believe the FCA has been a catastrophic failure. My constituents have gone through London Capital & Finance, Woodford and Blackmore Bond. We saw the FCA’s failure to address HBOS and RBS properly, and we are supposedly still waiting for the independent review of Lloyds that was established in 2017, yet the FCA has moved not one inch to take further enforcement actions. As I have made clear on the Floor of the House, I was concerned that the FCA chief executive at the time was accused—rightfully, I believe—of being asleep at the wheel. Before we even had the report on London Capital & Finance and so on, we appointed him as Governor of the Bank of England.

Bim Afolami: The right hon. Gentleman is making an important and interesting speech. On that point about the FCA, will he explain to the House whether he supports changing the regulatory structure and having one super-regulator, or something of a similar description?

John Martin McDonnell: The hon. Gentleman knows where my mind is going. We instituted a regulatory review a couple of years ago, and Prem Sikka, a professor of accountancy, and a team of corporate specialists and finance specialists introduced an excellent report. He is now in the Lords and I warn Members that he will shred this legislation when it goes up there. He outlined that 40 bodies are regulating our finance sector in some way and that there is a need for consolidation and to learn the lessons of the experiences of some of these bodies so far. That job is still to be done. I was hoping that the bringing forward of this legislation would coincide with the Government’s clear recommendations on where we go on that structure and, in particular, the role of the FCA.
I am also concerned about the fact that, although we are having the debate about this legislation, we are not debating potential future threats. I am anxious that in this legislation we are not addressing shadow banking, where we have already seen elements of individual firm collapses, particularly in respect of equity firms, that could create a domino effect and then produce a significant collapse.
I am also anxious about the move away from MiFID II. That issue has been raised and was derided by some in the House. We have recently seen the evidence with regard to speculation on both energy and food prices. Of course the cost of living crisis has been caused by a combination of the breakdown of supply chains, covid and the war in Ukraine, but there is significant evidence now that these increases in energy costs and food costs have been exacerbated by speculation in the markets. This is speculation where the paper markets are distinct from the reality of commodity supply. It is not just me expressing that; it has been expressed elsewhere, particularly in the States, but also by a number of global institutions. I regret that we have not addressed that issue in this legislation. We need to hold to the MiFID II, particularly the constraints on asset holding with regard to food commodities, as I am anxious about price speculation forcing prices up.
I was critical of Gordon Brown on some of his response to the banking crash in 2007-08, but one thing he did successfully was bring the world together, and there were international meetings where we looked at a global response to these problems. I believe that we now need to look at a global response to the food and energy speculation that is taking place, which is exacerbating the cost of living crisis that our constituents are facing. In that way, the Government’s approach is lacking. We will have the discussion tomorrow about their response to the energy prices increase and the cost of living crisis. I am hoping that from that, and as we move forward, we will recognise that there is an international role to be played by this Government in bringing people together, in the same way as Gordon Brown did.
I am particularly concerned about the issue of food. The UN special rapporteur Olivier De Schutter has said that what is happening now is that people are betting on people’s hunger. That cannot be right. Anything that we do that undermines in any way our own national legislation, which is against speculation in essential products such as that, is dangerous, but if we fail to ensure that we take up our international responsibilities, we will regret that for the future, as our people increasingly confront the problems of hunger and starvation.

Martin Vickers: I fully support the recommendations in the Bill and it is noticeable that it contains a wide-ranging set of proposals. I am not going to dwell on the more serious issues, as they have all been covered admirably by my hon. Friend the Member for Salisbury (John Glen), by the Chair of the Select Committee, my right hon. Friend the Member for Central Devon (Mel Stride) and, of course, by the former Chancellor, my right hon. Friend the Member for Richmond (Yorks) (Rishi Sunak). I am returning to the issue of access to cash, which has been raised by a couple of speakers.
It is not only cash, but the wider range of banking services that is crucial to our local communities. Proposals that have come forward in recent weeks affecting my own constituency involved the closure of what is, in effect, the last bank in the towns of Barton-upon-Humber and Immingham. I am delighted to say that in one case LINK, with which I have been working closely over those recent weeks, has designated Barton as one of its next banking hubs. That announcement came only yesterday, so it has slightly taken the sting out of what I was going to say, but of course, Immingham is still urgently in need of a financial hub. Proposals are being put together, and the local community and I will certainly take those proposals forward to LINK.
It is worth remembering that although when we listen to our constituents we hear tales of how reliant they are on their local bank and the services it provides and so on, we are all to some extent guilty when it comes to the change in the use of branches. I suspect that not one Member present in the Chamber can claim not to have used a credit card or bank card to make a payment when cash would perhaps have been a better option—we have all probably done so today. We have to recognise that; it is very easy to paint the banks as the bad guys, but they obviously have to amend the services they provide. However, it is interesting to note that more than 5 million people in the UK rely on cash on a daily basis, and it is estimated that 4 million adults do not have access to a smartphone and 1.5 million households do not have internet access. As such, while it is important that businesses make decisions in line with the general trends of customer behaviour, it is also important that we do not leave behind those who are in the more vulnerable groups.
As I said, I am delighted that the Cash Action Group and LINK have come together and announced that Barton-upon-Humber will receive a financial hub. That is great news, but we must also remember that it is not just access to cash that is important, so I urge the Minister and his team to think about the wider range of banking services. Until now, people of my generation, certainly, have been more used to face-to-face meetings with banks. Doing online transactions is fine, but when doing online applications for what can be life-changing decisions—a mortgage, for example—giving us guidance and making us think more seriously about the commitments we are making is an important part of the service that our financial institutions provide.
I welcome all that the Government are doing. As it stands, there is no existing legislative framework guaranteeing a minimum level of access to cash and wider banking services, or a single authority with overall responsibility for overseeing a cash system that works for everyone across the country. It is welcome that the Government seek to address that situation through the Bill, which will also empower the regulator to ensure that local communities continue to benefit from a cash withdrawal or deposit facility. I also repeat the point that my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) made: access to cash should be free. One of the things that annoys me and, I am sure, many others is that we are paying to get our own money. I urge the Minister to insert the word “free” into the legislation, something that I am sure would have cross-party support.
Bearing in mind the constraints on time, I thank LINK’s staff for the work they have done in respect of Barton-upon-Humber, and appeal to them to take an equally sympathetic view when making their decision about a banking hub in Immingham. I also urge the Minister to think about inserting that additional word “free” into the legislation.

Stella Creasy: I do not want to disappoint my colleagues on the Government Benches, but I think that they know the issue on which I wish to focus in the time that is available to me. Before I start, I want to put on record, as a Co-operative and Labour MP, my support for the comments of my Labour colleagues on the importance of access to credit unions and of access to cash, which reflects the issue that I want to raise, particularly with regard to high-cost credit regulation.
I also wish to put on record some scepticism about the idea that there are wonderful opportunities as a result of Brexit. To my mind, there are simply problems that we will need to address, and I note that the former Minister, the hon. Member for Salisbury (John Glen), talked about the unlikelihood of a derogation from the existing regulations. Some may wonder whether this is the best use of parliamentary time, but I am willing to look at the legislation.
There is a genuine philosophical disagreement here about the concept of consumer protection. It is the lesson of high-cost credit regulation in this country that I do not think this legislation learns and it is our constituents who will pay the price.
Let me start by highlighting the points of agreement. I agree with the right hon. Member for East Hampshire (Damian Hinds) when he talks about this as an industry that is shape shifting—that it evolves to meet the times that it faces. Let me also put on record my appreciation of the work of the former Minister, the hon. Member for Salisbury. He and I have had many discussions about this industry and how best to address the threat that it poses to our constituents. Although we may not have agreed all the time, I have certainly respected the fact that he has been listening and looking at the evidence.
I am here today as a Cassandra, a broken record, to warn again of these industries and the latest antics of the companies, particularly the buy now, pay later lenders. Two years ago, we started to say that those lenders must be regulated, and I would argue that that was probably 18 months too late from recognising the threat that they pose.
The lessons of payday lending, guarantor lending and hire purchase agreements show that we simply cannot wait until the harm is evident among our constituents, especially when the abuse that is coming is self-evident already. Now that we are in a cost of living crisis, such caution is frankly unforgiveable, because it is our constituents who are paying the price. I hope that we can return to this matter in Committee. I am sure that the Minister now dealing with this Bill will recognise that, especially as the £1.8 billion that this country owes in personal debt—a rise of £62 billion—has not come from nowhere. Credit card borrowing in this country has jumped at its fastest rate in the past 17 years as people deal with the cost of living crisis.
When a third of households with children are cutting back on food to be able to pay their bills, it does not take a rocket scientist to work out that too much month at the end of somebody’s money and mouths to feed mean that credit must be found, and our constituents are turning to the high-cost lenders in their droves. I would be surprised if Members do not know what buy now, pay later is, because it is on every single website in this country now as a result of the delay in action. It has massively exploded as a result of the pandemic and now the cost of living crisis. Those companies are offering the opportunity to spread the payments, but they do not do so out of the goodness of their hearts; they do so because consumers spend 30% to 40% more. Add that toxicity to the way in which people are borrowing now to make ends meet: we are seeing buy now, pay later companies offering to put people’s energy bills onto these processes. We are seeing them offering the loans not for fast fashion, which is where people originally thought this kind of regulation was needed, but for basic goods and essentials. Millions of people in this country are now using this form of credit and getting into a hole that they cannot get out of. Those are not my words; it is what the evidence is now showing us. The previous Minister well knows that the evidence of harm is there. Indeed, that is what the FCA told us more than two years ago.
The average buy now, pay later user is paying off £293 of buy now, pay later debt, but that is at current prices. With inflation rocketing in the way that it is, the only ones that will win from that are those that offer the ability to apparently spread the payments, but that simply gets people into further and further debt. Most of these companies will not be clear with their lenders about the consequences. Indeed, many people do not even realise that it is a form of credit; they just think that they are spreading the payments on the websites.
Shoppers were charged £39 million in late repayment fees on buy now, pay later loans last year. I dread to think what the figure is now. There is agreement across this House that we need to regulate these companies, but what there is not is the political will to make sure that it happens before the pressure points come. We have already been through one Christmas where one pound in every four spent was on buy now, pay later. There are millions of people still paying off those debts. On the regulatory timetable that the Government are talking about, we will not see action before some time late next year. Minister, some time late next year is far too late for our constituents.

John Glen: I cannot resist. I think there is great consensus in the House on this matter. It is not a question of a lack of political will; I can assure the hon. Lady that it is about the complexity of delivering that legislation. In fact, the intent’s having been stated will have a meaningful effect on market practices and will change, and is changing, behaviours in the marketplace.

Stella Creasy: I thank the former Minister for his intervention, but my question is what that means for consumers. The lack of regulation means that my constituents cannot go to the ombudsman to seek redress if they think they have been mis-sold this form of credit. As people are drowning in buy now, pay later  lending, they cannot seek assistance except from the companies themselves. We now see mainstream banks moving into buy now, pay later—the very bank that looks at someone’s account to decide how much they can spread payments and how much more they can afford to borrow, because this is a form of borrowing.
The hon. Gentleman may argue that the market is moving, but constituents need help now, because it is now that they are getting into debts that they cannot get out of. The challenge for us all is that the pace of change is horrifically slow, and that is where the damage to our constituents will come. If we all agree that regulation matters, let us get on with it. Furthermore, let us ensure that some of those basic changes, such as the ability for the ombudsman to intervene, happen.
This legislation shows that that matters, because it was the intervention of the ombudsman that made a difference with payday lending. The evidence is clear; the Financial Conduct Authority was overseeing Wonga while it continued to make loans that were unaffordable to its customers. It was only when the ombudsman intervened that Wonga was finally held to account for its behaviour, and as a result it went bust—and Wonga is not a one-off. Our constituents need proper consumer credit protection.
The Minister will know that it is my belief that there should be a proper credit capping process for all forms of credit, so that we do not have to play whack-a-mole. The right hon. Member for East Hampshire reflected that when he talked about shape-shifting: as one of these companies is regulated, another one comes up. In the intervening period, however, it would be perfectly possible to bring in the ombudsman. If we set out a separate regulatory regime for those companies, we are setting a precedent for other forms of credit to come and ask for separate and, frankly, special treatment.
What our constituents need is clarity about who to go to when they get into trouble. We all tell our constituents to go to a debt adviser, but if they have rights, those rights need to be transparent. At the moment, if people are borrowing on buy now, pay later, they have no rights, because it is not regulated. They only have the indulgence of those companies, and asking turkeys to tell us whether Christmas is a good idea rarely ends in a present for anybody.
It is right that we act as quickly as possible. I do not agree with the hon. Member for Salisbury when he says that the political will is there, because frankly this could have been done a while ago. The timetable that the Government have set out, which does not seek any form of actual intervention until some time in late 2023—and even then, it is about consulting on further measures—simply will not wash. Every Member of this House will have constituents coming to them for whom buy now, pay later debt will be part of their debt make-up, who may have put their mortgage on it, because there are companies offering the opportunity of spreading payments. Little wonder, when after all the Government are telling us they are going to spread our energy bills; the Government proposals to date are a form of buy now, pay later.
I wish I was wrong. I wish I had been wrong about payday lending, but we waited too long, and there are still millions of people in this country who are owed money through the compensation scheme from those payday lenders because we waited too long to intervene. We must not make the same mistake again.
I put the Minister on notice, and I ask for support from across the House, because I do not think this is a party political issue; it is about the pace of change. I will be proposing an amendment to this legislation that will give the Government the same time period of 28 days that the buy now, pay laters give our constituents to bring in that secondary legislation and give our constituents the protection of the ombudsman. It is a necessary and vital measure in a cost of living crisis to ensure that when people who cannot choose between eating or heating—because they cannot afford to do either—turn to buy now, pay later, they are not creating further problems for themselves down the road.
I know that hon. Members across the House agree that this kind of lending is a problem, but it is time for clarity, it is time for simplicity and it is time for that legislation. I hope that I will find supporters on the Government Benches, and I know that we will find supporters in the other place. Above all, I know that our constituents deserve better.

Andrea Leadsom: I would like to begin by paying huge tribute to my hon. Friend the Member for Salisbury (John Glen), who in four and a half years as Economic Secretary to the Treasury achieved an enormous amount, and the Bill is testament to his huge commitment. It was a pleasure to deal with him on many issues in that period. Having done his job briefly for one year, I can absolutely understand what a huge commitment it was for him. I am torn, however, because I absolutely love the new Minister, with whom I have worked as a Back Bencher on many issues in finance. It is great to be in the Chamber and to be able to contribute to the debate.
Enough of the nice stuff. I think the Bill is essential and deals with a big area. People talked so much nonsense in the Brexit debate—“Oh, the City of London is going to collapse!” I remember going to a Dubai international conference where Xavier Bettel, the Prime Minister of Luxembourg, said, “Well, if the UK leaves the EU, the City of London will move to Luxembourg.” I remember thinking in my jet-lagged brain, “Surely, you could not fit just over a million people in Luxembourg. The queue for the coffee shop would go down the street.” There was so much nonsense, and the Bill is absolutely brilliant and long overdue. It is time that we took control of the City of London and its competitiveness. It is high time that it had a competitiveness objective and that we took advantage of this perfect opportunity to be the leader in the world in setting out financial regulation and in exporting to countries across Asia, where people cannot get mortgages or insurance and all those sorts of policies that we take for granted, which we can buy and regulate in the west. Leading regulation in finance around the world is absolutely critical.
Another huge opportunity for the UK is being the world’s leading green finance centre. My first question for the Minister is what are we doing about that? Is it in the Bill? In my view, it will happen. I think that the green industry is going to be an even bigger employer and an even bigger jewel in the crown than the financial services sector in future, but we should seize the opportunity to make that happen as soon as we can. Mutual recognition agreements are absolutely vital. Having left the EU, we have the freedom to make them, but will the Minister  explain how those MRAs will be scrutinised by the House. That is a technical question—I am sure that there is already an answer to that.
Moving on from competition, which is at the heart of this measure and absolutely vital, to payments, I recall from my days on the Treasury Committee from 2010 to 2014, and then as City Minister, how dire our payment systems are, mainly because they have been around for a long time, held together with string, Sellotape and sealing wax. Someone said, slightly bravely, that we should feel sorry for the banks—never feel sorry for the banks—but nevertheless, it is their own doing that the ancient payment systems are very clunky. A lot of fraud today is the result of payment systems not being fit for purpose. Again, will the Minister explain whether there is a requirement in the Bill to improve payment systems and make them more robust? Will banks, particularly clearing banks, invest in those systems? How will new digital currency regulation interact with fiat money regulation and what protections will there be for people who, unfortunately, become victims in the digital money space? How will we protect them from fraudsters who claim that they are regulated by the Bank of England or the FCA? What are we doing about that? Have measures been written into the Bill?
On access to cash, back in the day, after the financial crisis, the big banks wanted to ditch cheques, for example, because they could not see the point of them. They were expensive to administer, but as MPs we know that many of our constituents rely on cheques to this day. Only recently, my daughter was sent a cheque and tried to cash it. People literally cannot do that unless they go to a bank. Otherwise they have to fill it in, take a photo of it and send it to the bank in an envelope with a stamp. That is absolutely ridiculous, as there are many people who depend on cheques.
What are we doing in the Bill to continue to protect access to cheques and, as others have said, access to free cash through ATMs? Those are disappearing at a rate of knots. As the last bank in town has started to close, post offices have picked up a lot of the slack, but that system is waning. A lot of the services that small businesses need are not available through post offices, and of course it is difficult for someone who is not digitally savvy to open a new bank account other than by going to a branch, which can be difficult for older people.
My final point is about credit unions. I am a big fan—always have been. What I love about them is that they teach people to save before they borrow. Like many co-operatives, credit unions have been great at reaching out to schools and teaching young people about the importance of saving and the fact that money does not grow on trees, so they get into the habit of saving their pocket money before they go out and start borrowing money for anything. As has been mentioned, a lot of Government money went into helping the Association of British Credit Unions to create a new, proper platform for credit unions. How is it doing? How is the co-operative movement doing? Is there anything in the Bill that will support not just those co-operatives but, vitally, financial education in schools?
Let me finish by saying that it seems to me that, although financial education is on the national curriculum, it would be so much more valuable to so many young people to know how to open a bank account, what a  rental agreement is about, or how to fill out a mortgage form, a tax return or a credit agreement than to learn more geometry and the square root of nine.

Nick Smith: I am glad to see the introduction of the Bill. Its provisions for securing access to cash, which I think should be free, will be welcomed in Blaenau Gwent. I strongly endorse the focus in chapter 3 on improving the accountability of financial regulators. Which? magazine has described this as a “once in a generation opportunity to strengthen the UK’s financial services regulatory regime”—quite the mouthful—but much more still needs to be done.
Unfortunately, I have lost confidence in the main regulator, the Financial Conduct Authority. Its oversight of the British Steel pension scheme scandal was plain hopeless. I saw the stress and grief of steelworker pensioner constituents who had been ripped off, and I have seen in my own experience as a member of the Public Accounts Committee just how useless the FCA can be. Despite being duty-bound to ensure that consumers were given quality financial advice, the FCA displayed poor oversight of the adviser marketplace. It consistently failed to act, even though it was aware of the risks to pensioners transferring out of a defined-benefit scheme. It failed to regulate a marketplace rigged against the steelworkers.
A recent Public Accounts Committee report found that the FCA failed to protect BSPS members from unscrupulous financial advisers who were financially incentivised to provide unsuitable advice, and that the regulator was “behind the curve” in its response. As a result, after much prodding, the FCA itself found that a staggering 47% of transfer recommendations were unsuitable. This has meant that many BSPS members have suffered years of nagging worry and losses to their pension pots, and had their plans for retirement ruined.
The National Audit Office discovered that, in the claims made to the Financial Services Compensation Scheme, the average individual loss stands at an eye-watering £82,600. Due to the FCA’s failures, the final bill for the coming redress scheme will likely be in the hundreds of millions of pounds. Despite having the powers to respond to the thieving and poor adviser behaviour, the FCA has issued just one fine in relation to the BSPS case.
Although I welcome the FCA’s efforts to improve its consumer-facing work in recent months, I am not convinced that the proposed framework will ensure that consumers are properly protected. It is good that the Treasury will have increasing powers to direct the FCA to make, review and enforce new rules as and when the need arises—the Treasury needs to jump in where necessary—but we need a fit-for-purpose FCA that robustly defends its consumers at the outset. It needs to hold bad actors to account from the get-go.
Therefore, I believe that consumer protection should be better embedded in chapter 3 of the Bill as a key accountability of the regulator. That is why I hope to see amendments made to mandate a much sharper focus on consumer protection with statutory panels that centre on the consumer. In Committee, there should also be a review of the FCA’s enforcement powers, which may need boosting.
Confidence in the regulator to have the best rulebook, enforcement and a culture that stands behind the consumer is key. Financial sharks that rip off working people need to be netted. The FCA needs to look across our country as well as at the City of London. Therefore, I ask the Minister to make doubly sure that the Bill has the strongest possible provisions for consumers and that the regulatory culture at the FCA is fit for purpose—something much more like the Securities and Exchange Commission than the limp enforcement regime at the FCA now.
Experience shows that the FCA consumer panel needs the firepower to challenge the culture at the FCA. Will the Minister please look again at that topic? A strong consumer voice must be at the heart of all our financial regulators; it needs to be a fundamental guiding principle.

Pauline Latham: It is a pleasure to speak after other hon. Members who are interested in access to cash. The many people who need it cannot exist in this cashless society. I intend to speak briefly to clauses 47 and 48, which aim to put on a statutory footing some of the best conclusions of the independent access to cash review in 2019.
The Cash Action Group is already carrying out important work to ensure that those who need or want access to in-person banking services continue to have it. I support clauses 47 and 48 because they will encourage that activity, put it on a statutory footing and regulate it. In Belper in my constituency, the final high street bank branch, Lloyds, will close in November. That is very common and is happening all over the country as high street banks are closing their branches, much to the horror of the elderly population and of many younger people, particularly those on the breadline.
A significant minority of people in many communities, including Belper, still want to or can only use cash and in-person banking. My right hon. Friend the Member for South Northamptonshire (Dame Andrea Leadsom) talked about her daughter getting a cheque. What do people do with cheques these days? Many people need access to a bank. A survey that I ran locally revealed that more than 60% of respondents had used in-person banking services in the last month, and more than 35% never used online or virtual banking.
When high street banks take the commercial decision to close branches, one option is to open shared banking hubs, where the consulting room is occupied by a different bank one day each week. Every day, businesses and individuals can use the pay-in desk, staffed by the post office, to carry out everyday cash withdrawals and payments. In Belper, many small businesses need access to that service, to the point where the post office is overwhelmed by the number of people who use it.
Respondents to my survey overwhelmingly backed such a shared banking hub in Belper, and I was delighted that it was announced yesterday that Belper will indeed host a shared banking hub. I have been told that the data shows that such hubs increase footfall on the high street and improve cash practices for local businesses, having knock-on effects well beyond simply providing cash and banking services to people. This is in a way a social service for some often very lonely people who will come into Belper to have conversations with real people. They do not want to do banking online, and elderly  people in particular, who can be isolated in their homes, need this service so that there is a reason to go into town and actually talk to people. I think this is such an important thing to happen.
In addition, these banking hubs are going to be good for the environment. In my survey, over 50% of those who currently bank with the bank that is closing in Belper said they would have to use a car to get to their new nearest branch and, worryingly, nearly 20% told me that they would have no way at all of getting to another branch. Therefore, the shared banking hub will actively reduce the amount of traffic and emissions Belper residents use while doing their banking. As Belper is a transition town, they are very keen to care for the environment. I am delighted for Belper with the success of this campaign, which I have run alongside local councillors.
I hope that shared banking hubs can be rolled out across the whole country, because I think they are the future. If it is not commercially viable to keep a bank open five days a week, it is much more likely that it can keep going one day a week, and that is where shared banking hubs will really win out. That is why I support clauses 47 and 48, which appoint the FCA as the lead regulator for access to cash and will mean that the Treasury can designate firms to be subject to oversight for the purpose of ensuring the continued provision of cash and banking services access. That should encourage even more banking hubs in communities that do not currently have good access to cash or banking, and I hope that all hon. and right hon. Members will support the Bill when we vote later today.

Sarah Olney: It is a pleasure to take part in this debate. First, I would like to welcome the Minister to his position and wish him a long ministerial career. It is a privilege to take part in this debate with so many well-informed Back Benchers, which I would say has been a real feature this afternoon.
The Liberal Democrats welcome this Bill. Obviously, it is absolutely essential for the ongoing regulation of financial services and markets in this country, and we very much welcome the majority of its provisions. As the hon. Member for Salisbury (John Glen) mentioned, it is a very big Bill. It has 330 pages, and it is clearly the result of a great deal of hard work over many months by many individuals. However, I have to say that it is disappointing, given the flexible nature of the financial services industry and the fast-moving nature of the sector, that this Bill does not go further in anticipating some of the issues we think we will be experiencing. It was interesting to hear from the hon. Members for Walthamstow (Stella Creasy) and for Blaenau Gwent (Nick Smith) about some of the issues they are already experiencing in their constituencies—of course, those issues are not just confined to the ones they represent—that the Bill does not address, and I want to come on to a couple of those.
The main aim of the Bill is to establish a new regulator, and the role of regulators has come under microscope quite a bit over the summer. We have seen, for example, that Ofwat does not have powers to stop sewage being pumped on to our beaches and that Ofgem does not have powers to prevent massively increasing fuel bills  for domestic consumers or businesses. I think it has come as something of a surprise to many of our constituents that the role of regulators currently in this country is perhaps not as extensive as they thought. I know that certainly many of my constituents will be expecting a regulator of financial services to have powers that go beyond what is provided for in this Bill.
I am particularly concerned about the focus on competitiveness, which has already been raised by the hon. Member for Brighton, Pavilion (Caroline Lucas) and others, at the expense of other statutory objectives, and I very much want to endorse what she said about the importance of reflecting net zero objectives. Indeed, this would be an excellent opportunity for the Minister to say a little more about that, perhaps in his concluding remarks. For all his many faults and failings, the previous Prime Minister was a massive champion of the net zero agenda. During the summer we heard some interesting signals from the new Prime Minister about her approach to that issue, and this is a great opportunity for the Minister to place on record that the new Prime Minister, and this new Government, will have the same commitment to those net zero objectives, and perhaps to talk more about why we do not see them enshrined in the Bill.
What concerns my constituents is that consumer protection is not as much of an important issue in the Bill as the strategic objective on competitiveness. We have talked already about fraud and scams, which are causing huge harm throughout our economy. I will not say too much about cryptocurrency, but there is no doubt that the landscape of crypto offers unseen, untold opportunities for future fraud, and we must get our heads around that. Fraud is causing huge harm to individuals and our economy, and current structures for tackling it are not fit for purpose.
I am surprised when I hear from constituents who have been victims of fraud, because it is not just vulnerable people or those who perhaps lack education, or older people who are not used to online banking; this issue affects vast swathes of people, and I am often surprised by how well educated, experienced professionals become victims of fraud. It is clear that we are not yet sufficiently on the side of the consumer in tackling it. Yes, there is always an element of buyer beware, but the scales are being tilted too far in favour of the fraudsters, and we need to be doing much more to give people powers to tackle that. I welcome the measures to tackle push payments, but I would like to see a great deal more about fraud. That is not just an existing and growing threat because, as I said, the prospect of threats in future is enormous. The onus is not just on the individual to protect themselves, because I do not believe they have sufficient powers to do that.
A further area of concern is access to cash. Much has been said about that already, so in the interests of time I will merely endorse what the hon. Members for Cleethorpes (Martin Vickers), for Mid Derbyshire (Mrs Latham) and for Edmonton (Kate Osamor) have already said. I particularly want to emphasise free access to cash. Obviously, rural and remote communities have particular needs, but the hon. Member for Edmonton summed it up well when she said that urban constituencies can also be poorly affected by that issue. I support the proposed community banking hubs, but currently their creation requires buy-in from existing banks, and we need something that can be independent of that.
In conclusion, the Liberal Democrats very much welcome the Bill, although we would like to see stronger powers to tackle fraud and more on access to cash. A point was made at the beginning of the debate about regulators. A regulator’s powers are granted by Parliament, which is why it is so important that Parliament has power to hold a regulator to account. The real weakness of the Bill is that so much is being delegated to secondary legislation that will not have scrutiny or oversight. As I said, we want to be at the forefront of financial services and their development. It is a fast-moving sector, and we in this country have the skills and experience for it to continue to be a key sector. However, it is vital that Parliament has the oversight that it needs regarding the set-up and ongoing activities of the regulator, and the Bill must be strengthened to ensure that.

Several hon. Members: rose—

Eleanor Laing: Order. Most unusually, after I imposed a time limit of seven minutes, several colleagues have decided that they do not want to speak in the debate after all. I am therefore able, most unusually, to extend the time limit to eight minutes, starting with Paul Maynard.

Paul Maynard: Thank you very much, Madam Deputy Speaker. What a lucky boy I am to have another minute to spend—gosh! I refer the House to my entry in the Register of Members’ Financial Interests as a member of the consumer council for LINK, which not only manages the nation’s ATM network but is the overarching body that can get new banking hubs in place. It is important for people to bear that in mind in listening to my comments. I would have paid tribute to my hon. Friend the Member for Salisbury (John Glen) if he were still here. Unfortunately, he is not, but he was always patient as I chased him around Westminster trying to ask about yet further nuance on access to cash.
One thing that we have learned today from listening to hon. Members is that access to cash is the wrong way to talk about the issue. It is about not just cash but access to face-to-face banking. Those who are reliant on cash, whether they are elderly or in financial need, must be able to speak to someone about their financial situation and not just interrogate a computer. We have heard from hon. Members about how reliant so many are on cash as a budgeting tool—increasingly so, given the cost of living crisis—with a jam jar approach to managing bills.
The Bill’s provisions on access to cash need to be about more than ATMs and ensuring that we can spew out cash to consumers; people need somewhere to spend it. The underlying problem is the economics of our cash system—the hidden wiring—and no one has mentioned the provisions in the Bill about the wholesale distribution of cash. If it costs too much for a retailer to use cash, why would they keep on accepting it? They need to be able to deposit it in an ATM just as much as a customer needs to be able to withdraw it to spend it in the first place. Far better still would be more local cash recycling, which would avoid the need for nationwide banknote distribution, if only for environmental reasons.
We must be careful not to accept the rather irresponsible narrative that, somehow, we are on the precipice of all ATMs disappearing. Some 94% of cash withdrawals are still from free-to-use ATMs, and LINK subsidises any ATM that was here in 2018 and no longer has an alternative within 1 km. Should that ATM disappear, LINK will fund a replacement. There is a strong backstop to ensure the presence of ATMs in our communities.
As I said, the debate has moved far beyond ATMs, and towards face-to-face banking, largely thanks to the Herculean efforts of Natalie Ceeney, who wrote the original access to cash review back in 2019. She has banged chief executives’ heads together across the banking sector to ensure that they move forward on banking hubs, which, as we have heard, are making such a difference in Belper and Barton-upon-Humber as well as more and more places across the country. LINK is doing a fantastic job, looking at already announced and planned bank closures to identify where access to cash and face-to-face banking is already being reduced. Where those gaps are appearing, it is working with the overarching company that has been set up to fill those gaps. It assesses each closure and recommends better cash services for places without any branch services left to be delivered by a dedicated operating company.
Some have expressed concerns about the slow roll-out of banking hubs. We have had two pilots that have proved that they are workable measures. However, things such as asbestos removal and finding the right location in a community need to be factored in by a sector that has not previously had to act as a property developer. Some delay is therefore perhaps understandable, and I would rather that we got it right in each community than rushed to buy any old place and hoped for the best.
The creation of an overarching duty for the Financial Conduct Authority is very much the icing on the cake for the work that has gone on so far. It should be seen as a reason to take satisfaction. I think that those criticising the Bill for not going far enough do not fully understand what has already occurred. They need to recognise a win when they see one and then raise it. However, I do seek some clarifications from the Minister. I have sought one already, and he has been uncharacteristically reticent at the Dispatch Box in telling me what I want to hear, and he is normally very good at telling me exactly what I want to hear. Now, he knows where I lurk most mornings, and I will be there tomorrow if he wishes to approach me over my coffee and whisper sweet nothings into my ear about having heard my plea.
There is no point in offering us access to cash if that access costs £2.75 at cash machines in the poorest part of my constituency. That diminishes access to cash, because people will find it even harder to access cash should that cash machine mean that a free-to-use ATM has disappeared. All of this is meaningless unless the word “free” is introduced into the debate.
Secondly, the Government are putting out their access to cash statement. Can the Minister reassure me that it will not just be some crude measure of geographical accessibility—two miles here, one kilometre there or whatever? That would not reflect the need in the likes of Mitcham and Morden, which is a very urban constituency rather like mine. My right hon. Friend the Member for Dumfriesshire, Clydesdale and Tweeddale (David Mundell) spoke earlier. He has a vast rural area where one kilometre, frankly, will not mean much on the hills and the moorlands.

Alison Thewliss: The hon. Gentleman is making an excellent point on the proximity of cash machines and arbitrary limits. The city centre of Glasgow is right at the heart of my constituency. Putting a couple of kilometres around that would basically knock out every other cash machine that was not on Buchanan Street, so I agree with his point. Does he agree with me that the Government have to think more carefully about such limits?

Paul Maynard: I very much welcome that. The challenge for the Government is that the access to cash statement must reflect what good access looks like—not just to a cashpoint, but to wider in-person banking services. It cannot just be “Can I get a bank note out of a machine?” It has become increasingly common in my own local area for cash machines not to have been filled up. There is not much point in having a cash machine without any bank notes in it, as if it were a rather decorative antique object.
One important feature that does not require legislation, but which deserves a great deal of comment—more than the two minutes I now have—is the right for communities to review any decision taken on whether they should have a banking hub. Not only is LINK assessing any closure of a bank branch already announced, but the right for a community to request a review of cash access. I am sure every single Member worth their salt in this place will be sitting down looking at the map of their constituency and saying, “I need a review there, there, there and there.” I am sure LINK will not thank me for doubling or quadrupling its workload in that regard, but it is a fantastic opportunity and a mark of how far this debate has moved. In my view, the legislation should specify a simple, fair and independent process that allows communities to appeal decisions. That could easily be placed in the legislation as an additional duty for the FCA. It will help the communities, the banks and LINK by ensuring a fair, independent and transparent method for communities who are not satisfied to have issues quickly considered under the oversight of the FCA. There is a great deal of suspicion out there about the banks and their approach to their branch networks. I do not want communities to appeal or to ask LINK to have a look and then be very disappointed about why they do not get the banking hub they might think they are entitled to. The process must be clear and transparent for communities to have confidence in it.
In summary, the Government proposals ensure that the FCA has the powers it needs to tackle the issue of access to financial services. After many years—my hon. Friend the Member for Salisbury is back now. He missed me saying well done to him. Don’t duck out for your starring moment! I don’t know. [Laughter.] This issue has taken far too many years to solve. It has not his fault either; it has been very complex. Too many communities have lost the banks they already had. Too many have been reduced to a single bank or to no bank at all. We now have a robust process in place to identify the locations, to find an alternative, to find a solution, without people having to drive miles away. For that reason alone, the Bill is to be welcomed. But it can be improved with one single four-letter word: free. Please, Minister, free me from my anticipation and make cash free to access.

Emma Hardy: I want to start with a general point about the Bill, which puts an awful lot of faith in our regulators to be able to carry out the functions written in it. I have been approached by members of staff working for the FCA—in fact, staff representatives at the FCA—who have talked to me about the current climate there. There are issues around recruitment and, specifically, around the retention of skilled individuals, and how relations are breaking down to a rather concerning degree. If we want the FCA to do everything that the Government are saying they want it to, especially post-Brexit when we are moving regulation across, then we need a competent and effective FCA. I hope the Minister will take that point away. I am happy to have further conversations with him on the matter, so we can resolve the issue.
It seems particularly concerning that the FCA does not recognise any trade union. When comparable bodies such as the Bank of England recognise trade unions and the FCA does not, that seems to be indicative of the problematic workings of the FCA. I do not want to comment further on that, but I hope that the Minister takes that away as a serious point, because we cannot have effective regulation if we have ineffective working practice.
I was going to intervene on the Minister but I was pipped to it, because he sat down before I could. However, I wanted to mention clause 64, which is about providing insurance after terrorism incidents, so if insurance becomes too expensive, someone can continue to have insurance and the Government will step in. I thought that that was interesting because I have repeatedly raised in the House flood insurance, Flood Re, what happens if buildings are continually flooded and how we make sure that we have affordable flood insurance. It is very good that the Government want to introduce that provision for acts of terrorism, but I hope that the Minister will look more deeply into flooding and businesses’ concerns about that.
Let me turn to my main gripe with the Bill, and I am sure that the hon. Member for Salisbury (John Glen) will know exactly what I am going to say. As I mentioned to him in passing the other day, he is welcome to support any of my amendments, because he has heard all this before. I was disappointed that there was no provision on having regard to financial inclusion. It is great that there is a provision on having regard to the Climate Change Act 2008—the Labour party legislation—but there is nothing on financial inclusion. I will table amendments to give the FCA a cross-cutting “must have regard to financial inclusion” provision, and I genuinely call on Treasury Committee members to support them, as this was a recommendation from one of our reports. The proposals would include a statutory duty to report to Parliament annually on: the state of financial inclusion in the UK; the measures that the FCA has taken, and is planning to take, to advance financial inclusion; and recommended additional measures that could be taken by the Government and other public bodies to promote financial inclusion.
This is a bit of a no-brainer. We have a cost of living crisis, with people suffering from severe levels of debt and hardship. We have a Government who are potentially—though we are not quite sure—bringing forward massive amounts of borrowing to be heaped  on taxpayers for years to come, and what I am proposing is free. When do we ever get to do that? I am proposing a small solution to the cost of living crisis that is absolutely free; it would address the poverty premium and ensure that the FCA “has regard” to financial inclusion.
I assume that the Minister will refer to the FCA consumer duty as an example of action that the Government are taking. However, that is not enforceable until July 2023—unless the new Prime Minister decides not to move it at all—and it does not address the fundamental problem of what happens to the clients that the market do not want. I am talking about those who are locked out and excluded from financial services. The previous FCA principles were about treating customers fairly, but that still does not address what happens if the market does not want someone.
What is the poverty premium, and what does that mean? In real life, that means people paying more for credit due to their credit rating, paying more for insurance because of where they live or past health issues and paying more for services, because they cannot benefit from direct debits or—as we have heard mentioned a few times—they need to use cash. I find it ludicrous that we have a situation where it costs more to pay in cash than it does in direct debit. We know exactly the kind of people that harms. Of course, the poverty premium is not limited to areas under the FCA’s remit. We have had previous debates about gas and electric and pre-payment meters, which I will not go into now, but the costs are very real.
Let me give an example from my Kingston upon Hull West and Hessle constituency, where nearly a fifth of constituents are affected. The poverty premium means that it costs them nearly £6 million more a year to access the same services and goods. If any Members who are listening are interested—especially those on their phones—they can look at the Fair By Design website, where they can look up their constituency and find out exactly how much the poverty premium is costing each and every one of them. This can be addressed by ensuring that the FCA “has regard to” financial inclusion.
Financial inclusion has been mentioned briefly, and I pay credit to the Government for what they are doing on credit unions. That is a good step forward, but this is always passed between the FCA, the Treasury, other regulators and Departments. Everyone nods very seriously and says how important it is. Someone says, “We must seriously do something about this but it is not actually our Department’s problem. It is someone else’s problem.” And the next person says, “Oh, this is really important. We must do something about it, but is not for our Department. It is their problem”—so the issue goes round and round with nobody actually taking responsibility. That is why having regard to financial inclusion is so important in terms of the FCA having a remit to actually look at this.
I am thinking particularly about insurance. A specific example is car insurance: people cannot drive without it, yet for so many it is simply unaffordable. That leads either to people driving without insurance or to their being unable to take on specific jobs because they simply cannot afford it. We need to do something about that.
My proposals, for which I will call for support across the House, will try to address it. They would end the current damaging situation by giving the regulator a clear remit and saying, “The buck stops here—you have regard to financial inclusion, so you need to look at this.” Sometimes that will mean the FCA taking a main role, and sometimes it will be others, but it will mean that the buck stops somewhere, so somebody has to take the issue seriously and look at the extra costs facing the most financially vulnerable in our society.
I also call on the Minister to introduce measures for groups facing digital exclusion and give them technological support with banking. Specifically, we need measures to ensure that blind and partially sighted people can access their finances and manage them independently.
I am very excited, because I keep asking to be on the Bill Committee and I think I have finally been given the nod. I look forward to discussing the Bill in more detail at every opportunity and through every clause as it goes through Parliament.

Bim Afolami: It is a pleasure to speak in support of the Bill. I will not repeat what so many hon. Members have said about the excellent work of the former Economic Secretary—my hon. Friend the Member for Salisbury (John Glen)—and the present Economic Secretary in bringing it to the House, but I want to bring up a couple of specific issues that may not have come up in the debate as much as they might have.
The former Chancellor, my right hon. Friend the Member for Richmond (Yorks) (Rishi Sunak), mentioned the call-in power. There has been some criticism in the press, which may or may not have come from people within the regulators or from people speaking on their behalf, suggesting that the Government’s call-in power will somehow damage our regulatory system or that it is somehow illegitimate for the elected Government or this House—in extremis, if they feel that something is badly awry—to override the non-elected regulators in a specific area of financial regulation.
I put it on record that those concerns may be well intentioned, but I think they are wrong. It is critical that this House and the elected Government have that power over something as significant as the financial regulation of the sector that is our jewel in the crown. The sector employs millions of people, two thirds of whom are outside London. We all accept, on both sides of the House, that we should champion the sector and work with it. It is almost unconscionable that such a power does not already exist, so we should stand firm if, in the other place or in Committee in this place, Members wish to reject the call-in power. I think it is critical.

Alison Thewliss: The hon. Gentleman speaks with a lot of expertise in the area. Could he give an example of when the power might be used? In what circumstances might the Government want to use it?

Bim Afolami: Lest anybody should think I have any particular specialist knowledge, I stress that this is entirely my own view, but I could imagine a scenario in which the Government, supported by this House, intended certain changes to a regulation such as MiFID II. A strategy document might say that the intention is for a, b and c to occur, but when the regulations were drafted, that intention might not appear to come through. In  that instance, it would be very legitimate for the House or the Government to say, “No, what we intend is the following, and we will change the detailed regulation in order to achieve the aim—the democratic aim, supported by the Government and the House—that we seek to achieve.”
There are a couple of other areas in which I think the Government could have gone further in the Bill, and which I hope we will consider in the coming weeks and months. The first is the bank levy. I know that this is not always a popular thing to say, but in politics it is sometimes important to say unpopular as well as popular things. When we have an internationally competitive sector, if the tax burdens of jurisdictions with which we are competing for people, for capital, for institutions or for new investment reach a point at which they are significantly, or even a little bit, less than ours—and people may find those jurisdictions attractive for other reasons—we should consider finding ways of reducing our own tax burden, which has risen in recent years. The bank levy was one of those, but it came during the aftermath of the financial crisis, which happened quite a long time ago. I think we should consider getting rid of it, in order to emphasise as much as we possibly can that Britain is still the leading centre of financial services for the world.
I am not saying that this is a panacea; far from it. The Bill contains 300-odd pages because we have a great deal to do. However, the bank levy is a tax, and if we impose high taxes on internationally mobile capital or institutions, there may well be a penalty for this country in terms of attracting those institutions. I ask the House, and in particular those on the Treasury Bench, to reflect on that point.
My second point concerns ringfencing, which the former Chancellor mentioned. When I was at HSBC—I probably should have declared at the beginning that I worked at HSBC before I came to the House, and indeed in other institutions in the City—I had the good fortune to work for quite a long time on the internal restructuring of the bank as part of a strategy of which ringfencing was a huge element. HSBC and Barclays were the two big British banks that had big consumer retail bits and big investment banking bits.
Even at that time, it was obvious to many of us that the most critical part of what we were doing in ensuring the safety of those institutions—and indeed, because they were so big, helping to ensure the safety of the whole financial services sector—was the recovery and resolution power, and not just the ringfencing aspect. While I think the review that has been carried out is very capable and very thorough, I urge the Treasury to look a bit further, and to ask whether we still need ringfencing even under the terms of the way in which it has been reviewed. Can we look again at the thresholds? Can we make this less onerous for big institutions?
Why should we do that? I return to what I said about competitiveness. If there are ways in which we can improve our competitiveness without compromising on safety, I think we should consider them.

Ian Paisley Jnr: Let me take the hon. Gentleman back to his earlier point about competitiveness, and the possibility of certain institutions being turned off from investing or establishing themselves,  or removing themselves from the United Kingdom. Where does he think the single largest threat comes from, if there is a turn-off?

Bim Afolami: I would posit two particular jurisdictions. First, I think of the London stock exchange. The House may not fully appreciate the amount of capital that it has, through capital raising by means of initial public offerings and various other measures. However, we have seen a dramatic fall-off since even five years ago, let alone 10 years ago. Meanwhile, Amsterdam’s stock exchange is doing very well. I think that, although Amsterdam as a jurisdiction will never rival London or, I should say, the UK, because we have huge advantages and huge strengths, we need to consider the threat to the London stock exchange from that source.
Secondly, there is the middle east, where various jurisdictions, including some quite surprising ones—particularly Dubai—are trying hard to make themselves attractive to, in particular, capital from America and Asia, and to make themselves into a hub for some of this work. Again, they cannot rival us, but it is not necessary to match us fully to damage our competitiveness, and I think it important to bear that in mind.

Ian Paisley Jnr: Does the hon. Member think that that when it comes to those locations, especially the middle east, there may be an opportunity for, let us just say, funds to arrive at those destinations without being scrutinised to the same extent as they would be here in the United Kingdom? Is that a potential threat to the banking sector?

Bim Afolami: I do not want to cast aspersions on any other jurisdiction. It is clear that we should be proud of our own high standards. I know we will probably get to discussing illicit money from Russia later this year, as we did earlier in this Session. In this country we take action and we pride ourselves on our higher standards—that is not always the case everywhere—but that aspect of competitiveness is not a race to the bottom. This is a really important point. We can be competitive and have high standards. We should not say that the drive for competitiveness means that we drop our standards and end up with corruption, money-laundering and all the rest of it. That is not necessarily true. In this country we are proud of our institutions, proud of our sector and proud of our ecosystem, but that does not mean that nothing needs to improve, and this Bill contains a huge panoply of measures that can help to strengthen our financial services sector.
My last point is about mutual recognition agreements. These are quite dry technical things but ultimately they allow for the easing of doing business between one jurisdiction and another—for example, between the UK and Switzerland, with whom we have built a very good relationship. We should do much more of that, but we should work with the International Trade Department to ensure that our trade deals include much more in terms of services provision and not just mutual recognition agreements that are separate from that. Services trade will benefit this country more than pretty much any other country in the entire world, and we need to work with our International Trade Department, with the Foreign Office and with our international ambassadors to achieve that aim.

Several hon. Members: rose—

Nigel Evans: I see that eight Members want to speak, so we will have to reduce the time limit to six minutes to get everybody in.

Wera Hobhouse: My hon. Friend the Member for Richmond Park (Sarah Olney) has already indicated that there is quite a lot to welcome in this Bill, but there also are a number of things that we Liberal Democrats do not agree with and would like to be improved. The Bill does not actively promote the leading green finance sector that we were promised. According to the WWF, we need $32 trillion by 2030 to tackle the climate emergency. The Bill in front of us could be a unique opportunity to develop the green economy that the future needs by providing routes to roll out net zero technologies and allowing UK businesses to capitalise on green transitions.
As the chair of the Climate Change Committee pointed out only this morning, tackling soaring energy bills—currently the most important thing we are considering—and tackling the climate emergency go hand in hand. Net zero technologies could reduce household bills by £1,800 a year—a reduction that is desperately needed by so many people. This Bill could be a unique opportunity to make that happen, but it falls dramatically short.
In its current form, the Bill prioritises competitiveness over net zero and accountability. Clause 25 adds the need to advance compliance with the UK net zero emissions target to the list of regulatory principles to be applied by the FCA and the PRA. However, the new principle—namely, that regulators must “have regard” to the UK net zero target—is not strong enough. Additionally, they will have limited margin to acknowledge the role of nature in achieving net zero. This approach is reckless. The Bill opens up the possibility, as has been mentioned today, of soaring food prices by throwing out reforms introduced in 2008 to protect consumers from volatile trading practices.
The Government always defend their net zero strategy by placing responsibility on the markets, yet before the 2008 reforms, food prices rocketed after speculative trading on future food prices drove up prices. Regulators are vital to ensuring that consumers are protected and that markets function well but not out of control. A former UN special rapporteur has said that speculators
“are indeed betting on hunger, and exacerbating it”.
Our country cannot afford to have another dimension added to the cost of living crisis.
Rather than volatile competitiveness, the Bill must provide clear legal obligations and a commitment to the UK’s net zero target. Net zero must have the same priority for regulators as economic competitiveness. The scale of the climate crisis requires massive shifts in approach that can be achieved only with explicit legal duties, which must include a new objective to decarbonise the financial system. As I have already said, regulations and net zero aims have to work hand in hand. The Government must add climate targets to the primary objectives and thereby give them a status higher than the one the Bill currently proposes.
We Liberal Democrats would go even further and ban new fossil fuel companies from being listed on the London stock exchange. We would also create new powers   for regulators to act if banks and other investors do not properly manage climate risks. That is the sort of ambition that we need, but the Government’s ambition is lacking. We have less and less time to act on the climate emergency. The time is now. I urge Ministers not to miss this unique opportunity.

James Davies: My comments on this welcome Bill will focus primarily on its ability to improve access to cash and banking services. In my constituency, like many others, bank closures have become increasingly problematic. It is now seven years since the last bank shut in the city of St Asaph in the heart of my constituency, while Denbigh has also seen closures. Last year, TSB, Barclays and HSBC shut in Prestatyn, following the town’s loss of NatWest, Royal Bank of Scotland and building society branches in the preceding five years. Prestatyn High Street was left without a single bank or cash machine, despite being a busy regional shopping centre.
Cash remains important for many residents and businesses in my constituency. Following a campaign, and thanks to Cardtronics and Principality building society, three new free-to-use cash machines have now been installed in Prestatyn town centre. In addition, since June this year new legislation has brought about cashback without purchase services through various local businesses. However, banking services in the town remain lacking.
Last year, Derek French, a former executive of NatWest and the founder of the Campaign for Community Banking Services, identified the 50 communities in Britain where he believed shared banking hubs are most required. Prestatyn is one of the 22 of those communities that have already lost their last bank branch.
Earlier this year, the Royal Society for Arts, Manufactures and Commerce published a report suggesting that 10 million people would struggle in a cashless society. As incomes are squeezed, there is evidence that some people are turning back to cash to help them to budget. The Post Office reported record withdrawals in July 2022, while LINK ATM withdrawals still exceed £7 billion monthly.

Paul Girvan: I appreciate that the hon. Member has highlighted a number of banks and areas that are being decimated by banks removing themselves from the high street. A section of our community who are not IT literate have a major problem and are being totally disenfranchised. We need to put in place legislation to ensure that those people are not left without access to the banks that they have used all their lives.

James Davies: The hon. Gentleman is absolutely correct. I hope the Bill will go a long way to help that situation. I was coming on to say that 10% of people are planning to use cash more in the coming six months because of cost of living pressures.
The access to cash agenda owes much to Natalie Ceeney and her access to cash review. Following a landmark agreement at the start of this year, the banks and leading consumer groups formed UK Finance’s cash action group. LINK took on the role of assessing the impact of proposed bank branch closures on communities. As of 4 July, the agreement was extended to include communities where bank closures have already taken place. LINK can recommend new cash services,  such as banking hubs and ATMs, according to the cash access needs in each community. New services will then be delivered by a new banking hub company set up by the banks, or, in the case of ATMs, by LINK.
This Bill puts this very welcome voluntary arrangement on a statutory footing. It confers on the Treasury a duty to prepare a cash access policy statement, which I understand is currently being drafted, and powers to “designate” banks and firms such as LINK and the Post Office to take steps in relation to that policy. Furthermore, it gives the FCA powers to take action on those designated firms.
This summer, I put forward Prestatyn for assessment by LINK for a banking hub. I am very grateful to Nick Quin, head of financial inclusion at LINK, for his visit to the town in January and for meeting me with his colleague Chris Ashton this week to discuss in detail my application on behalf of the town. A banking hub would facilitate cheque and cash deposits, and cash withdrawals, and banking staff from each of the big banks would be based in the hub on specific days to help customers with community banking issues. So this legislation is very much welcomed, and I extend my thanks to the Economic Secretary to the Treasury and, in particular, to his predecessor, my hon. Friend the Member for Salisbury (John Glen), who I know has put an awful lot of time into this agenda.
I urge the Government to consider ensuring that assessments of the needs of communities by LINK should be transparently published and that there should be a formal process of appeal. I also ask that consideration of access to banking services through the Welsh language be referenced in the cash access policy statement. Furthermore, it would be helpful to explore the scope of the community banking services that banking hubs could potentially be mandated to provide—for example, opening a new bank account, amending direct debits and standing orders, applying for a loan, arranging third-party access or commencing bereavement procedures.
It is also important to clarify whether the Bill will give the FCA the power to prevent the closure of a bank branch, ATM or cash access point of another kind where there is no suitable alternative in place, so that in future new gaps in provision do not occur. I understand that in recent times LINK has protected 3,000 free ATMs in remote and deprived areas, and funded new ATMs in more than 100 communities. I hope the Government will commit to protecting free cash withdrawals and deposits, and that that can be explored in the policy statement. An indication by the Minister of the likely publication date of the policy statement would be particularly appreciated.
Other elements of this Bill will enable credit unions to offer a greater range of products and services; strengthen the rules around financial promotions; and enable regulatory action by the Payment Systems Regulator to require the reimbursement of victims of authorised push payment scams. All of that is very much to be welcomed, but I urge the Government to ensure that the authorised push payment scam regulations cover all feasible methods of payment, both now and in the future.
I fully support the Bill, especially as it responds to significant concerns over the availability of cash and banking services. It is important that the Bill be delivered as soon as possible so that existing cash infrastructure can be protected.

Ben Lake: It is an honour to be able to contribute on this important Bill this evening and a real pleasure to follow the hon. Member for Vale of Clwyd (Dr Davies), who gave us a masterful and detailed account of the problems and challenges that the loss of bank services and bank branches causes for rural communities in particular. I hope to emulate some of his mastery of the subject in my remarks.
I wish to begin by associating myself with some of the concerns raised by other Members, particularly my friend the hon. Member for Glenrothes (Peter Grant), who talked about the transfer of responsibility and scrutiny power away from Parliament and more towards the regulators and, in certain respects, as regards the repatriation of some of the regulations, to designated legislation committees.
I also associate myself with the concerns that have been voiced about the need to strengthen as an objective for the regulators the need for sustainable growth and to ensure that they are very much aligned with some of the Government’s expectations on net zero. I do not think that we have yet heard an explanation as to why that statutory objective cannot be placed on the regulators. I see it as working hand in hand with sustainable growth and competitiveness; they do not necessarily need to compete with each other.
As I mentioned, I will focus my remarks on access to cash. In particular, part 2 of the Bill—clauses 47 and 48 —and the corresponding schedules 8 and 9 have a great deal to commend them. I put on record my support for some of those measures, which I believe will bring a real improvement, safeguarding access to cash for so many of our communities. Of course, we must note that a lot of communities, including in my own constituency of Ceredigion, have already suffered the loss of bank branches and ATMs. It has long been the case that people in those communities have had to travel 10 or 15 miles in order to access a free ATM, but the Bill at least puts in place a set of regulations and a process to ensure that no further gaps arise in future. For that, I do welcome it.
However, returning to a point that has been made by several hon. Members, including the hon. Members for Blackpool North and Cleveleys (Paul Maynard) and for Cleethorpes (Martin Vickers), I ask the Government whether it would be possible to extend the remit of the access-to-cash clauses to include certain services, and in particular in-person services. Other Members have explained just how important continued access to in-person services—branch services—is for many individuals; we have heard about their particular importance to the elderly, and to those who are perhaps not IT literate. I would add that in some rural areas, of course, digital banking remains a distant dream due to a lack of connectivity, so the ability to access personal banking advice is an essential amenity for residents of those areas.
However, something that bears repeating—I admit that it is perhaps not something I have afforded enough attention to in the past—is the impact that the loss of in-person banking services has on small businesses and on charitable and community organisations. Over the past decade or so in Ceredigion, we have seen a number of towns lose their final bank. Nevertheless, they are still market towns; they try to plough for a prosperous  future, but the loss of in-person banking services has had an impact on small businesses and on charitable and community organisations.
To offer a few examples, small businesses in Tregaron, in Lampeter, and increasingly those in Llandysul, will often have to travel to Carmarthen, which may be a round trip of between 45 and 60 miles, depending on where they are located. Of course, the banks open during business hours, which to small businesses entails either closing for a few hours in order to deposit cash or access other banking services, or going without. I know for a fact that many businesses are now having to amend their business practices in unhelpful ways in order to accommodate that new banking reality.
It has also been a real challenge for many charitable and community organisations to open accounts. For example, I have been told that a community pub initiative had to wait almost nine weeks to open a bank account due to the changes in services locally. Charities, in particular, have reported to me that banks just do not understand the specific requirements they have as account holders; they do not understand that changing mandates in person is a particular task for charities. In rural areas, as in many others, many of those charitable groups and organisations make a valuable contribution to communities. At the end of the day, they are staffed by volunteers, and forcing those volunteers to travel 60-odd miles just to change a bank mandate is unfair.
That is why I would be very interested to see whether the Government could extend the new access-to-cash requirements to include those banking services. At the moment, I am afraid, banks are not waking up of their own volition to the importance of maintaining those services in rural areas, and communities are being let down. That is where the Government could step in; that would be a very important intervention, and would be much welcomed on both sides of the House.

Nigel Evans: The last Member with six minutes is Harriett Baldwin, and then we will go to five minutes, so everybody will have exactly the same amount of time.

Harriett Baldwin: It is an honour to be called to speak in support of the Bill. In a way, it is an advantage to be called at this time because so many excellent points have been made by so many wonderful people, and I am pleased to say that I agree with most of them and that they have been expressed better than I could have done, including by the former Chancellor and the former Economic Secretary to the Treasury, who was responsible, I think, for putting together quite a large part of this Bill.
I recall the milestone of when the country voted to leave the European Union on 23 June 2016, because I was Economic Secretary to the Treasury at the time. Many questions came to the fore about what would happen to the regulation of our financial services, which have been referred to many times in this debate as one of our most important export and tax-paying sectors, providing many hundreds of thousands of jobs up and down the land. It is a very important sector, and  over the past six years we have flirted with the idea  of equivalence.
It is, I think, the EU Commission that has decided that equivalence does not suit it. Frankly, I think it is the EU’s loss, because obviously we are equivalent—or we were equivalent. It is the EU’s small businesses and growing firms that will lose easy access to the United Kingdom capital markets, which is a shame for them. I also know that discussions were had about the EU-Canada trade agreement and about the chapter on financial services, which is not in our current trade agreement with the EU. Clearly that has been rejected as a way forward, although there is scope for much more mutual recognition and the opening up of markets.
I welcome the decisions that have been made before the publication of this Bill, and the opportunities for divergence that are being seized in it. It is also welcome that the industry has been very much consulted and brought along with us on how Solvency II and MiFID II changes can help our economy grow.
However, the point on which I wish to focus has not been brought up much in this debate: the freedoms that this Bill gives us to look once again at the market for advice and guidance in this country. We have heard about many of the challenges that consumers face when they are making financial decisions on their own behalf. The cost of financial advice is high, and the guidance itself can be very generic. There is, of course, access to the Money Advice Service and to Pension Wise, which I encourage constituents to use if they can, but the Bill gives us the opportunity to look once again at the financial advice market and to have more customised guidance because of how technology has evolved and the important role that the FCA’s regulatory sandbox plays in allowing people to experiment.
I urge everyone who has spoken about consumers in this debate to support an amendment that I am planning to table with the help of the Investing and Saving Alliance. It would allow the provision of much more personalised guidance through the use of innovation and technology, helping consumers through difficult decisions such as moving pensions when they change employer. That would create a better informed consumer who would not necessarily fall so easily for some of the scams that we have been hearing about during today’s debate. We need to arm our consumers to be able to tackle those scams.
My final point is about the role of the regulator. Time and again in this debate Members have asked who regulates the regulator if it puts in place something with which we as MPs or our constituents disagree. There is an important role here for the Treasury Committee, on which I sit, and we will take that responsibility of scrutinising changes very seriously.
I also think one of the great strengths of our country is our common law; I know the Minister has been looking at the opportunities that have been outlined for bringing in some further rights of appeal through the common-law system against some decisions that regulators make. I know he has taken these points seriously, and I look forward to his responding to them at the end of the debate.

Nigel Evans: Just to inform everybody, the wind-ups will begin no later than 6.40 pm, and anybody who has spoken in this debate will be expected to be here at the wind-ups. With five minutes, I call Siobhain McDonagh.

Siobhain McDonagh: I am furious to report the imminent loss of yet another bank branch in Mitcham town centre. The year before last it was Nationwide, last year it was Barclays and this time it is Halifax—a bank that pretends to consult its long-standing and loyal customers about its branch closure, but then refuses to attend my public meeting to hear the concerns of those customers in person. Contrary to its slogan, “It’s a people thing”, it seems that Halifax does not care at all what people think, at least if they live in Mitcham and are elderly, disabled or rely on face-to-face banking services.
Every day this week I have stood outside the branch, gathering customers’ views and listening to their concerns. Their opposition is overwhelming; this latest bank closure is yet another nail in the coffin of access to free cash, and I have the evidence to prove it. When Barclays Mitcham closed last year, one of a staggering 650 Barclays branches to disappear since 2015, we surveyed more than 500 residents outside the bank. An extraordinary 50% did not use online banking and were reliant on that branch. Many did not have access to the internet. Some did not trust it. Others, particularly the elderly, only used cash. Then there were those who relied on the help and support of the staff, who they could trust with their money.
I do not believe these views are unique to Mitcham. When high streets lose their banks, the digital divide prevents far too many people from turning online. Age UK highlights that one in five older people still rely on cash for everyday spending. But Barclays did not care. Despite having three years still to run on the lease, it closed the branch and swapped it for a bus—yes, really, a bus—that pulled up randomly outside the empty branch, on the off-chance that a customer was fortunate enough to be passing by and willing to queue in the rain. That sounds safe as houses.
“Do not fear,” they said. “There are other branches just a bus ride—or two—away, or your constituents could just use the post office for their basic banking needs.” That is the same post office whose doorway was too small for my disabled constituent to access with her wheelchair, the same post office that no longer has a free cash machine outside. Fortunately, we still had Halifax—well, until now. Its loss is the latest hammer blow to our high street. Does the Minister agree that Mitcham now makes a perfect location for a new shared banking hub?
We are told that a community can demand access to free ATMs, but that is not the experience on the ground. People in Pollards Hill have tried for years to get a free ATM. Residents literally have to pay for access to their cash—small amounts of money that they get on a daily basis and for which they are charged. The nearest post office had one installed, but now even that has gone, and a ridiculous clause in the new Co-op’s lease prevents a free ATM from opening because there is a paid-for machine further down the terrace. How can that possibly make sense?
I believe that the need for access to cash is growing. The cost of living crisis has seen the return of money jars, with households separating their cash and counting out their pennies to ensure they can make ends meet. Of course I accept that we are in a changing society and  reliance on cash has changed for many, but those on the wrong side of the digital divide are simply being cut off from society, made to feel not part of the same world that we inhabit.
Take Mr Barley, chair of Mitcham’s British Legion branch. Throughout the lockdowns, he relied on his milkman for milk delivery and the rest, but, as hon. Members will have guessed, Milk & More is now going online too and such loyal, long-standing customers no longer get that service. I say to the Minister that the Mr Barleys of this world are treasured in our communities. Halifax Mitcham’s remaining open is not a silver bullet to solving the problems they face with the digital divide and access to cash, but if we are not careful, and everything from milk to money moves online, then they are at risk of simply being left behind.

David Simmonds: I add my congratulations to Ministers past and present involved in introducing the Bill. It is an incredibly important piece of legislation for my constituents. Ruislip, Northwood and Pinner has a high level of employment in the City and in connected financial services, and the subject is close to my heart, as I belong to an even more cherished race of human beings than Tory MPs—I am a former banker.
There have been a number of exceptional contributions to this debate, so I shall try to confine my contribution to items that have not been covered in a lot of detail. First, the Bill is good and important because it will continue to support innovation in the financial sector, of which the UK has a long and proud. If we look at the role played by financial centres in London and Edinburgh in the development of financial products that have brought security and stability to people’s lives, we can see that for centuries the UK has been a leading light in the world. A piece of legislation that enables the sandbox concept, for example, continues to support that innovation and incredibly important to the sector.
Secondly, as we move away from EU structures and governance, we need to ensure that there is appropriate scrutiny of arrangements for regulation and of the implications of the mutual recognition agreements into which we propose to enter. Contrary to what is sometimes said about EU matters being dealt with by unaccountable bureaucrats in Brussels, if anything, our criticism in the UK was that there was often too much scrutiny and democratic involvement. With trade deals, for example, agreements had to be looked at by the European Parliament and the Committee of the Regions. They had to be signed off by the Council of Ministers. There were multiple levels of engagement in that process, and we need to ensure that organisations such as Zurich, which shared a helpful briefing with hon. Members—it certainly informed my thinking about the Bill—can have appropriate input so that we get the calibration right to support innovation, as the Minister is committed to do, and so that we have appropriate consumer protection.
Many Members have referred to the sector as a jewel in the crown of the British economy, which clearly remains the case. It is striking in the context of the Government’s levelling-up agenda that we see, for example, significant inflows of investment in Northern Ireland as a result of opportunities that have been created by the  development of the economy there. That has created an opportunity to look at how we spread the benefits beyond the centres to which my right hon. Friend the Member for Central Devon (Mel Stride) and my hon. Friend the Member for Salisbury (John Glen) referred. That is critical for the reputation of the sector, and it is incredibly important for our economy too.
A key part of that is ensuring that we futureproof the regulation of financial services in the UK. There has been much mention of crypto, but I would like to add the need to ensure that non-regulated activity undertaken by regulated institutions requires scrutiny. Our thanks are due to Private Eye magazine, for example, for the detail that it has provided in shining a light on the activities of a number of organisations. The hon. Member for Glenrothes (Peter Grant) referred to things such as funeral plans, but we also need to pay a good deal of attention to the activities of will writing organisations and trust services—for example, the Family Trust Corporation and the Philips Trust Corporation—because significant numbers of consumers may find themselves heavily disadvantaged as a result of advice that they thought came from a trusted financial source, but which was not regulated.
Finally, access to cash has been discussed a good deal. I specifically highlight the need, especially for small businesses, to be able to access banking for the purpose of transacting in coins. In my constituency, I have heard from a lot of small shopkeepers and small business owners that it is not just about consumers being able to get to an ATM—it is about their being able to pay in coin that they receive in payments from customers and being able to extract it for the purpose of having change for cash transactions, which for the most part they cannot do with ATMs.
In conclusion, I am pleased to support the Bill, which as the Minister said will support innovation in this key UK sector. It will ensure that our country remains a global market leader and, importantly, it will ensure that consumers in my constituency and across the UK are protected from scammers who may seek to do them financial harm.

Nigel Evans: Those who have participated in the debate should start to make their way towards the Chamber for the wind-ups, which will start at 6.40 pm.

Jim Shannon: It is a pleasure to speak in the debate. The Bill is substantial and weighty, and rightly so. Our financial services sector is vital—perhaps never more so than today, given the cost of living, for people at the mercy of the financial institutions to lend them money to carry their businesses through this period, for families looking for a low-interest loan to fix their cars, and perhaps even for the housewife trying to buy a second-hand washing machine. Those are the ordinary things that people have to face.
The regulation of financial services is essential. We must get it right and rectify the remnants of regulation where Europe was unsuccessful in fostering businesses and protecting individuals. I am keen to support clauses  8 to 23, which will grant additional powers to regulators, allowing for greater regulation of financial promotions. This morning in Westminster Hall we spoke about cryptocurrency and cryptoassets. The Minister answered some of our questions, but that is a really important subject. It is estimated that some 2.6 million people across the UK, and 100,000 people in Northern Ireland, use cryptocurrency. Some 15% of people in Northern Ireland use it, and 38% say they have thought about using it but have not yet done so. The regulation of this up-and-coming form of investment and spending is necessary.
Clauses 24 to 46 seek to ensure appropriate democratic accountability for the regulators, given that the Bill gives the FCA and the PRA new secondary objectives to advance the international competitiveness and medium to long-term growth of the UK economy. I have spoken about this a number of times in the House, but I am not entirely convinced that the new regulations for the FCA are strong enough to make a difference, or that the Bill goes far enough in this respect.
I think regularly of one of my constituents, whose case I know exceptionally well. The episode of Panorama broadcast on 16 August, titled “The Billion-Pound Savings Scandal”, detailed a scheme in which some £47 million of life savings was taken from consumers. The initial figure was £16 million, yet although it seems the FCA had ample evidence of wrongdoing and the powers necessary to act, nothing was done. That constituent and a number of others have lost money through that scheme. I am not sure that the Bill goes far enough in that respect.
An essential component of the Bill must be the protection of access to cash. I am old-fashioned, Mr Deputy Speaker; I use cheques all the time, and I use cash. I have the jingle of cash in my inside pocket, and I have the pound notes—sorry, I am going back too far; I have the £20 notes here in my wallet. I heard the right hon. Member for South Northamptonshire (Dame Andrea Leadsom) refer to her daughter getting a cheque. I get them every day, and I write them every day—that is who I am.
Access to cash and its use is essential, particularly for the small business with a small profit margin. The Post Office announced that just last month it handled more than £800 million in personal withdrawals, the most since records began five years ago. That tells me that cash is still king and we should not disregard it.
I am old enough to remember the ’60s and the early ’70s, when my mum and others, on a tight budget, used envelopes to set aside money for the gas, the electric, food and the rent. That meant that the management of the moneys for all the bills was done right. I believe that history will repeat itself and we will see that happening once again. Cash will be more important than ever.
The right hon. Member for East Hampshire (Damian Hinds) referred to the growth of credit unions. In Northern Ireland, credit unions have been an incredible success. They can do better for everyone. In some cases, they have replaced banks where those have closed. Will the Minister say what can be done to ensure greater use of credit unions?
I am concerned that, as we approach the autumn and winter, many will suffer from malnourishment, freezing homes and depression in the coming crisis. I believe that  the Bill will do more than just regulate the financial regime; it will ensure that we can support the people we are privileged to represent and keep them protected this winter.

Gareth Davies: It is a great pleasure to speak in this debate on a Bill that is, frankly, the biggest reform of financial regulation in a generation. First, I pay tribute to the longest-serving Economic Secretary that we have known, my hon. Friend the Member for Salisbury (John Glen), who committed his work with great diligence and who is greatly respected in the industry to this day.
I care a lot about the financial services industry. I worked in it for many years, it taught me a lot about the world, and my wife works in it, so I personally want it to thrive, but given its significance to our economy and people, we all should. The Prime Minister was right when she said that it is the “jewel in the crown” of our economy. It is a direct benefit to businesses, savers and investors, and an indirect benefit to us all through jobs, growth and tax revenue. That is why it is important that we do everything we can to unleash its potential, as this Bill does.
I welcome the fact that the Bill takes advantage of our regulatory freedoms now that we are not in the European single market, gives more control to our domestic regulators and ensures that they are more focused on international competitiveness. All those who worry about that resulting in a decline in regulation should be assured that the primary objective remains intact, and that that mirrors established conventions in markets with highly regulated systems, such as Australia and Japan.
I welcome the moves to tighten the regulations on promotions by creating a new regulatory gateway for approvals. I also welcome the provisions to improve the co-ordination between the FCA and the PRA. As a member of the Treasury Committee, I welcome its enhanced role, but join others in saying that it is important that it has the resources and expertise to carry out that role effectively.
This is an excellent Bill that will help to drive the industry and our country forward. I have been struck that we all agree on one aspect, which I will talk about: the need to further democratise our capital markets. Despite the remarkable success in the finance industry, it genuinely bothers me that not enough of our people are directly participating in or benefiting from our capital markets. Although we are all stakeholders in UK plc, not enough of us are shareholders with a stake in our economic success.
We can do three things to address that. First, I am a huge advocate of extending auto-enrolment to those aged 18 to 22, so that they can get on the savings ladder earlier. That would create 900,000 new savers and £1 billion extra in savings for our economy, and it would do a great deal to encourage a better savings culture. Secondly, we should look at removing regulatory obstacles to people receiving investment advice, so that people do not just save, but invest. Thirdly, I want us to get on with reforming Solvency II, so that more pensioners can expand their investment universe into illiquids such as infrastructure. If we do those things, we can build on this excellent Bill and ensure that everyone shares in the success of our world-leading financial services sector.

Abena Oppong-Asare: I am grateful for the opportunity to close the debate on behalf of the Opposition. As my hon. Friend the Member for Hampstead and Kilburn (Tulip Siddiq) said, we broadly support this important Bill.
We recognise that regulatory divergence from the EU will produce opportunities for the sector, such as through Solvency II reform and making sure that the UK is a welcoming environment for fintech. We also support the principle of a secondary objective on international competitiveness and growth. Labour is committed to supporting the City to retain its competitiveness on a world stage and supporting the UK to remain a global financial centre outside the EU. This should not, however, mean any compromise on financial stability or consumer protections.
I also want to echo my hon. Friend’s point about recent Government infighting. This has undermined confidence in the City just when the sector needs clear direction on post-Brexit reform. The new Prime Minister’s off-the-cuff policy announcements during the summer and threats to abolish our world-leading regulators have left our financial services in a state of uncertainty. The Government must provide the City with the certainty it needs to thrive and to take advantage of opportunities outside the EU. I therefore hope that the Minister will use this opportunity to inform the House, the wider public and the financial services sector whether the Government plan to radically alter this legislation in the coming weeks and months.
While we will support the Bill, there are a number of issues that we believe the Government have yet to address. My hon. Friend raised a number of these important questions in her speech, which I hope the Minister will address in his closing remarks, including whether regulators will be held to account on the advancement of long-term growth in the real economy, and how the Bill will address the decline in the UK’s financial services exports to the EU.
I take this opportunity to thank the hon. Member for Salisbury (John Glen) for the work he did on this Bill. I, along with my hon. Friend the Member for Hampstead and Kilburn and the rest of our team, know that he was always communicative with the Opposition despite our differences and he was always respectful in his delivery. It is also pleasing to see the former Chancellor the right hon. Member for Richmond (Yorks) (Rishi Sunak) speaking in this debate, which shows that he is still taking this Bill very seriously.
I thank hon. Members on all sides of this House for their contributions. I am particularly grateful to my hon. Friend the Member for Feltham and Heston (Seema Malhotra), who talked about how mortgage prisoners are impacted by the SVR. I hope that the Minister will take up the invitation to meet her, as she certainly has a lot of knowledge in this area.
My hon. Friend the Member for Edmonton (Kate Osamor) spoke about how small and medium-sized businesses, such as hairdressers and nail salons, rely on cash payments and how her constituency is one of the most cash-deprived. The right hon. Member for South Northamptonshire (Dame Andrea Leadsom) referenced the need for free access to cash, and highlighted the   points raised by Opposition Members. I hope that on this vital topic we can find common ground to resolve this issue in the best interests of all our constituents.
My right hon. Friend the Member for Hayes and Harlington (John McDonnell) and my hon. Friends the Members for Kingston upon Hull West and Hessle (Emma Hardy) and for Blaenau Gwent (Nick Smith) all raised concerns about the FCA. I am sure the Minister will agree that holding bad actors to account is very important, and I look forward to his comments in his summing up.
My hon. Friend the Member for Walthamstow (Stella Creasy) made a particularly important point about how those using buy now, pay later lenders are drowning under the cost of living crisis. The wishy-washy intervention planned for 2023 will just be far too late. We need swift action right now, and my hon. Friend pointed out that there is a lack of strong will from the Government in this area.
My hon. Friend the Member for Mitcham and Morden (Siobhain McDonagh) spoke passionately about the closure of bank branches in her constituency and the impact this is having on elderly and disabled constituents.
All the contributions from across the House were really valuable, but I want to raise a number of additional issues, such as cryptocurrencies. First, clauses 21 and 22 will bring stablecoins, a type of cryptoasset, into the scope of regulation when used as a form of payment, which as the Minister has said, will pave the way for their use in the UK as a recognised form of payment. He and I discussed this in Westminster Hall this morning, but the recent collapse in the value of cryptoassets, including several stablecoins, has put millions of UK consumers’ savings at risk.
The crypto trading platform Gemini has estimated that as many as one in five people in the UK could have lost money in the crash. Does the Minister agree that the crisis in crypto demonstrates that so-called stablecoins are not necessarily stable? How did the recent collapse in the value of cryptocurrencies inform the Treasury’s approach to clauses 21 and 22 of the Bill?
Will the Minister explain why the Government have opted to bring only stablecoins within the regulations? For example, the EU just agreed to a comprehensive regime for regulating the entire cryptocurrency industry, while the UK will not even consult on a comprehensive regime until later this year. In the absence of a comprehensive regulatory regime, the UK has become a centre for illicit crypto activity. According to Chainalysis, a global leader in blockchain research, cryptocurrency-based crime, such as terrorist financing, money laundering, fraud and scams, hit a new all-time high in 2021, with illicit activity in the UK estimated to be worth more than £500 million.
Meanwhile, misleading advertising and marketing of cryptocurrency projects is on the rise. In the absence of a comprehensive regulatory regime, how will the Government crackdown on illicit activity and misleading advertising and promotions, beyond the regulated stablecoins? Finally, how do the Government foresee the regulated stablecoins interacting with the future of central bank digital currency?
Let me express the disappointment felt on the Opposition Benches that the Bill has failed adequately to address financial exclusion. My hon. Friend the Member for Hampstead and Kilburn has already touched on the need to address digital exclusion by protecting access to essential face-to-face banking services, and the Bill has failed to promote financial diversity and resilience by removing the regulatory barriers faced by mutuals, building societies and co-operatives. In addition to my hon. Friend’s important points, the Bill does nothing to address the poverty premium—the extra costs that poorer people pay for essential services such as insurance, loans or credit cards—and right now, those people will be feeling the impact of that.
Labour believes that everyone should have access to the financial services they need, whether that is saving schemes or insurance, and regardless of their income or circumstances. All too often, the most vulnerable in our society are unable to afford or are denied access to financial products and services that meet their needs. If the Government are serious about building a strong future for our financial services outside the EU, they should recognise that the Bill is an opportunity to rethink how financial resilience, inclusion and wellbeing issues are tackled in the UK. I hope the Minister will address those points in his response.
I realise that time is pressing, and I want to give the Minister the opportunity to respond to all the issues raised today. In conclusion, although Labour Members support the Bill, which will enable the UK to tailor financial services regulation to meet the needs of our economy, we will be pushing for bolder, more radical action in a number of areas including green finance, financial inclusion and economic crime, to make Brexit work for our financial services and the wider economy.

Richard Fuller: With the leave of the House I would like to speak for a second time, and I will start by thanking right hon. and hon. Members for their contributions to the debate. As the hon. Member for Erith and Thamesmead (Abena Oppong-Asare) has just said, I welcome the broad support across the House for the Bill.
As has been clear throughout the debate, I am really a small person standing on the shoulders of the two giants responsible for the Bill—my hon. Friend the Member for Salisbury (John Glen) and my right hon. Friend the Member for Richmond (Yorks) (Rishi Sunak). I will seek to address what I can of what has been said in the time available—[Interruption.] Shush. Where I am not able to, I shall write to colleagues where I feel that I can add something meaningful. I also look forward to Committee, where I will be able to address some of the points in more detail.
As I said in opening the debate, this is an important and ambitious Bill that seizes opportunities afforded by EU exit to make important reforms to the regulation of financial services. As my right hon. Friends the Member for Richmond (Yorks) and for South Northamptonshire (Dame Andrea Leadsom) and my hon. Friend the Member for Salisbury said, the resilience of the United Kingdom financial services market as we exit Brexit has been much stronger and greater than the naysayers said. Once again, people who talked down our country have been proved wrong.
There were questions on a number of areas, but I will start with access to cash, which was raised by a several Members. The UK Government remain absolutely committed to protecting consumers and supporting inclusion. The impact of bank branch closures should already be understood, considered and mitigated where possible so that all customers, wherever they live, and especially the most vulnerable, continue to have appropriate access to face-to-face banking services. Meanwhile, innovative, shared bank hubs allow customers of participating banks to withdraw and deposit cash and seek support from a representative of their bank in person. It was pleasing to hear the contribution from my hon. Friend the Member for Cleethorpes (Martin Vickers) regarding the hub at Barton-upon-Humber, and that of my hon. Friend the Member for Mid Derbyshire (Mrs Latham) about Belper. She mentioned the knock-on benefits that banking hubs can have on high streets both in Belper and in other parts of the country. My hon. Friend the Member for Vale of Clwyd (Dr Davies) and the hon. Member for Mitcham and Morden (Siobhain McDonagh) spoke about the importance of financial hubs in their constituencies.
Those are an important part of access to cash, but the Bill also provides the FCA with powers to protect access to cash specifically. Where appropriate, the FCA could exercise the powers in the Bill to prevent a branch closure where in doing so it is seeking to ensure reasonable provision of cash access services. That may be the case, for example, if a closure would result in a significant adverse impact in relation to accessing cash in that area. The Government expect such situations to be exceptional and temporary while alternative arrangements to meet cash needs are put in place, but ultimately that access to cash must and will be protected.
The Bill allows the FCA to determine standards to ensure reasonable access to cash access services. In determining reasonable access, the FCA may take into account factors that it considers appropriate, which may include appropriateness of facilities for vulnerable users, including cost, security availability and accessibility for, for example, disabled people. The FCA is developing its regulatory approach for access to cash and will consult in due course.

Tulip Siddiq: Does the Minister support free access to cash—yes or no?

Richard Fuller: I was about to come to that. As I said earlier, while I cannot give an assurance on free-to-use ATMs, I do expect us to return to the matter in more detail in Committee. I tried to write down those right hon. and hon. Members who used those four letters—F, R E and E—in describing their wish for access to cash. They included my hon. Friends the Members for Blackpool North and Cleveleys (Paul Maynard), for Cleethorpes and for Mid Derbyshire as well as the hon. Members for Kingston upon Hull West and Hessle (Emma Hardy), for Feltham and Heston (Seema Malhotra), for Richmond Park (Sarah Olney) and for Mitcham and Morden. As I said, we will return to these issues in Committee, particularly given the level of interest in them.
I turn to other matters. The shadow spokesperson, the hon. Member for Hampstead and Kilburn (Tulip Siddiq), asked about the new secondary objectives  for growth and competitiveness and whether they were aimed at advancing long-term growth in the real economy.   Those secondary growth and competitiveness objectives will enable the PRA and the FCA to make rule changes to advance the long-term growth and competitiveness of the UK economy, including the financial sectors. The new objectives refer to the UK economy as a whole, including in particular the financial services sector.
The hon. Member for Richmond Park, who is in her place, and the hon. Member for Brighton, Pavilion (Caroline Lucas), who I do not think is in her place, talked in an intervention about whether the regulator should have a green objective. Including the net zero target specifically in the regulatory principles ensures that the Government’s commitment to reach net zero will be embedded in regulator considerations. Therefore, it is more appropriately progressed by regulators as a regulated principle, which means they will consider the Government’s target when they advance their own objectives. We heard a lot about what the Government are doing on green finance which did not pay enough regard to the progress the Government have made already on that. Let me just list it. The UK is rated No. 1 globally in the Z/Yen Global Green Finance Index. The UK has had the largest green gilt instruments globally. The UK had the first green savings account issued with the national savings fund. The UK is the first major economy to implement fully the taskforce for nature-related financial disclosures across both financial services and the real economy. The UK is the largest donor to multilateral climate investment funds. That is a record this Government can be proud of. That is a record that this country can be proud of as well.
The hon. Member for Kingston upon Hull West and Hessle asked about having regard to financial inclusion. The Government believe that the FCA’s current and ongoing initiatives around financial inclusion demonstrate that it can already effectively support the Government’s leadership of this agenda through its additional operational objectives and regulatory principles.
The shadow spokesperson asked how seriously Parliament should take the speculated proposals to merge the regulators. There are no plans to merge  the PRA and the FCA. Again, she asked about the independence of regulators and how we can ensure the continued independence of our regulators. The legislative framework underpinning financial services regulation in the UK provides for the regulation to be independent of the Government.
My hon. Friend the Member for Wimbledon (Stephen Hammond), who I think may be in his place, asked about whether we could commit to an annual report on the key performance indicators of the regulators. Both regulators, I am pleased to say, will be required to report on their performance against their growth and competitive objectives on an annual basis. This will be similar to the PRA’s current reporting requirements for its secondary competition objective. My hon. Friend also asked about the important issue of cost-benefit analysis panels and what the accountability of the regulators will be. The Government expect that the panel will operate in the same way as other statutory panels, where they appoint external members. Ensuring the right membership of panels is crucial to their success in promoting and challenging a range of expertise.
The Chair of the Treasury Committee, my right hon. Friend the Member for Central Devon (Mel Stride), asked an important question about the Bank of England’s  independence. I can tell him and the House that the Chancellor today met the Governor. I refer him and other hon. Members to Her Majesty’s Treasury’s statement on that meeting. The Chancellor affirmed that the UK’s long-standing commitment to the Bank of England’s independence and its monetary policy remit. The Chancellor and the Governor agreed that getting inflation under control quickly is central to tackling cost of living challenges.
My right hon. Friend the Member for Richmond (Yorks) asked whether the European regulations on PRIIPS will be reformed. Yes, the Bill will repeal and retain EU law for PRIIPS. He also asked about ringfencing and whether ringfencing will be reformed. The Treasury welcomes the comprehensive set of recommendations to the Independent Panel of Ring-fencing and is committed to publishing a Government response later this year.
There were many other questions, particularly on MRAs—mutual recognition agreements—crypto-assets and other issues. I will have to write to Members, given the amount of time available. On the important issue of scams and fraud prevention, which was raised by many Members, I acknowledge the seriousness of the issues we face, but I do not accept that the Government and regulators are not taking action to prevent fraud, both in relation to financial services and more widely. The Government are clear that prevention is better than cure and that a multifaceted approach is needed to tackle fraud. The shadow City Minister asked what we were doing beyond financial services. I point to the Online Safety Bill, which the Prime Minister committed to in the House today.
There were many, many issues also raised that I have not had time to refer to today, but that just indicates the wide breadth and importance of the Bill. The Bill capitalises on our freedoms outside the EU by bringing forward an ambitious set of reforms that assert the UK’s global leadership in financial services, and I commend it to the House.
Question put and agreed to.
Bill accordingly read a Second time.

Financial Services and Markets Bill (Programme)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Financial Services and Markets Bill:
Committal
(1) The Bill shall be committed to a Public Bill Committee.
Proceedings in Public Bill Committee
(2) Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Tuesday 25 October 2022.
(3) The Public Bill Committee shall have leave to sit twice on the first day on which it meets.
Proceedings on Consideration and Third Reading
(4) Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which proceedings on Consideration are commenced.
(5) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.
(6) Standing Order No. 83B (Programming committees) shall not apply to proceedings on Consideration and up to and including Third Reading.
Other proceedings
(7) Any other proceedings on the Bill may be programmed.—(Richard Fuller.)
Question agreed to.

Financial Services and Markets Bill (Money)

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),
That, for the purposes of any Act resulting from the Financial Services and Markets Bill, it is expedient to authorise the payment out of money provided by Parliament of:
(a) any expenditure incurred under or by virtue of the Act by the Treasury,
(b) any increase attributable to the Act in the sums payable under any other Act out of money so provided,
(c) loans from the National Loans Fund.—(Richard Fuller.)
Question agreed to.

Financial Services and Markets Bill (Ways and Means)

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),
That, for the purposes of any Act resulting from the Financial Services and Markets Bill, it is expedient to authorise:
(a) the charging of fees,
(b) payments into the National Loans Fund, and
(c) the payment of sums into the Consolidated Fund.—(Richard Fuller.)
Question agreed to.

Business without Debate

Delegated Legislation

Motion made, and Question put forthwith (Standing Order No. 118(6)),

Exiting the European Union (Trade)

That the draft Cat and Dog Fur (Control of Movement etc.) (EU Exit) Regulations 2022, which were laid before this House on 20 June, be approved.—(Adam Holloway.)
Question agreed to.
Motion made, and Question put forthwith (Standing Order No. 118(6)),

Defence

That the draft Armed Forces Act (Continuation) Order 2022, which was laid before this House on 13 June, be approved.—(Adam Holloway.)
Question agreed to.

Petition - Windfall Tax

Richard Burgon: I rise to present a petition alongside a corresponding online petition signed  by over 65,000 people. They are appalled that, at this time of crisis, the Government are choosing to protect oil and gas firms’ super-profits, all made off the backs of higher bills for millions of ordinary people. They believe that these oil and gas giants should not be able to make a single penny in excess profits and are calling for these profits to be taken and used to provide crucial funding to help people through this cost of living emergency.
The petition states:
The petition of residents of the United Kingdom—
therefore requests—
that the House of Commons urge the Government to review proposals to at least double the Windfall Tax so that oil and gas firms do not make a single penny in excess profits out of this crisis, and use the billions in additional funding to help people through the cost-of-living emergency.
Following is the full text of the petition:
[The petition of residents of the United Kingdom,
Declares that soaring energy bills are driving the biggest fall in living standards in living memory; further that, to ensure that the needs of people are put ahead of the profits of energy giants, we need bold action including freezes to the energy price cap, energy firms brought into public ownership and the rolling-out of a mass programme of home insulation; further that we must also urgently tackle the eye-watering level of profits that North Sea oil and gas companies are making on the backs of higher bills for ordinary people; notes that the Conservative Government’s Windfall Tax is set far too low and lets oil and gas giants off the hook as they are continuing to make vast undeserved profits at levels way beyond what they had ever expected.
The petitioners therefore request that the House of Commons urge the Government to review proposals to at least double the Windfall Tax so that oil and gas firms do not make a single penny in excess profits out of this crisis, and use the billions in additional funding to help people through the cost-of-living emergency.
And the petitioners remain, etc.]
[P002765]

Petition - Right of Refusal of Development on Green Belt Land

Emma Lewell-Buck: I rise to present this petition organised by Jane Mills on behalf of 878 South Shields residents who oppose the development of 156 residential properties on land west of Sunniside farm, a site within the green belt with a food-producing arable field and a heavily used historical footpath linking two ancient monasteries.
The petition states:
The petitioners therefore request that the House of Commons urge the Government to change the National Planning Policy Framework to include a clause of a right of refusal of development on green belt land, thus giving local people the right to say what is to happen in their community.
Following is the full text of the petition:
[The petition of residents of South Shields,
Declares that the development of 156 residential properties on GA2 land is inappropriate and unwanted by the community; further that the development lies west of Sunniside Farm  in South Shields, a site within the green belt which has had a food producing arable field for over thirty five consecutive years; further that, if allowed, the development would disrupt the heavily used 7th century Bede’s Way footpath which links the two ancient monasteries of St Paul’s and St Peter’s which are dedicated to The Venerable Bede; and further that all communities should have a clause or exception of a right of refusal of development on green belt land which is used to produce arable food or where local communities do not want development that would destroy the openness and permanence of the land.
The petitioners therefore request that the House of Commons urge the Government to change the National Planning Policy Framework to include a clause of a right of refusal of development on green belt land, thus giving local people the right to say what is to happen in their community.
And the petitioners remain, etc.]
[P002766]

Petition - Communal Heating Systems

Munira Wilson: I rise to present a petition on behalf of 27 residents of Wharf House in Twickenham and a further 40 residents of Carlton House, Camera House and Shepperton House in Teddington. They are among the estimated 400,000 Londoners, many of whom live in social housing, who have been left unprotected by the Ofgem energy price cap because their homes are connected to communal heat networks.
The petition states:
The petitioners therefore request that the House of Commons urge the Government to reallocate funds to provide full, immediate financial support to households with communal heating systems, subsidise the excess cost of their bills over the energy price cap set by Ofgem, and to expedite the legislation the Government proposed last year to regulate heat networks in order to protect customers.
Following is the full text of the petition:
[The petition of residents of the constituency of Twickenham,
Declares that communal boiler schemes are not regulated by Ofgem, and are hence not protected by the cap on energy price rises; further that residents in Twickenham were told that their communal boiler schemes would be a more environmentally friendly and cheaper way of supplying energy; notes that residents have now been informed that the cost of their heating is going to rise by up to 700%; notes that there are over 14,000 heat networks in the UK, supplying as many as 480,000 people who have been left unprotected by the price cap as energy prices skyrocket; and further that a significant number of these homes are classed as social housing.
The petitioners therefore request that the House of Commons urge the Government to reallocate funds to provide full, immediate financial support to households with communal heating systems, subsidise the excess cost of their bills over the energy price cap set by Ofgem, and to expedite the legislation the Government proposed last year to regulate heat networks in order to protect customers.
And the petitioners remain, etc.]
[P002767]

Small Modular Reactors: Government Funding

Motion made, and Question proposed, That this House do now adjourn.—(Adam Holloway.)

Tobias Ellwood: Thank you very much, Mr Deputy Speaker, for chairing this timely debate on modular nuclear reactors in the United Kingdom. Until recently, we took our dependence on electricity generation for granted. Policy has rightly been influenced by our ambitions to reduce our carbon footprint, arguably faster than many other developing and developed nations, but we may have been a little complacent over the past few years in regard to the security of energy supply.
Our world is getting more dangerous, not less. The war in Ukraine has been a massive reality check, exposing how reliant we are on—and therefore how vulnerable we are to—access to international energy markets to keep our lights on. We require imports of gas, oil and coal to fuel our power stations. All too regularly, we have to import electricity from the continent through the interconnectors when we cannot generate enough power ourselves.
The security situation in eastern Europe is clearly complicating matters. Putin is weaponising Russia’s distribution of oil and gas, causing large-scale economic harm across Europe. The cost of living crisis here has many components, but arguably a major contributor is the spike in global energy prices and the volatility in the energy markets. All this requires a sense of urgency in finding short and long-term solutions. We expect that tomorrow the Government will spell out their support to get us through the crisis. There is much speculation that energy bills may be frozen, helping us to get through a very difficult winter, but we also require a longer-term strategy to become far more energy self-sufficient as we enter a decade in which global security is on the decline.

Jim Shannon: I congratulate the right hon. Member on securing the debate. Does he agree that the use of small modular reactors, in conjunction with nuclear energy, gives more solid certainty about sustained energy, particularly in relation to my constituency of Strangford in Northern Ireland? Northern Ireland has no nuclear production, so it is essential for the type of energy to which he refers to be UK-wide. It is needed across the whole United Kingdom of Great Britain and Northern Ireland.

Tobias Ellwood: I agree. I welcome the Government’s action to bolster our energy resilience: finally increasing UK gas storage capacity, investing in better insulation for our homes, growing the contribution of wind and solar to our energy mix, and of course investing in new nuclear. As the Government’s energy and security strategy sets out, Britain will accelerate new nuclear, including modular reactors, which will form a key part of the energy mix.

Jamie Stone: Will the right hon. Member give way?

Tobias Ellwood: I will make some progress, if I may.
We have Hinkley Point and Sizewell C coming online, adding 3,000 MW to the grid, but it will be a full decade before they start to add their power. We do not have the luxury of waiting that long. Energy consumption here and across the world will only increase as we move towards a cleaner fossil-free environment, especially across Africa, as economies and industries grow, placing ever greater demands on the ability to generate power.

Liz Saville-Roberts: Will the right hon. Member give way?

Tobias Ellwood: I will make a little more progress and then give way. I know that this is an important debate.
That last point brings me to the subject that we are discussing today: Britain’s development of modular nuclear reactors. The concept is not new; Rolls-Royce has been building small reactors to power our Royal Navy submarines for decades, so one would think the UK well placed to be the first nation to have one up and running.
The benefits are very clear, and I am sure that the list will be added to in this debate. Each single reactor from Rolls-Royce generates approximately 470 MW of energy, enough to power 1 million homes. They cost only £2.2 billion each, versus the £20 billion that their bigger brothers cost. Once the first five reactors are built, the concept can be proven and we can start looking at exports. The export market for Rolls-Royce is worth £54 billion to the UK. This will not only help the UK, but help other nations to address their crippling energy prices and meet their COP26 targets.

Liz Saville-Roberts: Trawsfynydd, in Meirionnydd, is entirely publicly owned, and is a nuclear-licensed site. As such, it offers an unparalleled opportunity for the fastest deployment of SMR technology at any UK site. The Nuclear Decommissioning Authority and the Welsh development company Cwmni Egino are working together on proposals for siting, and hopes are high that construction will begin in 2027. That is where the timing is so critical. I am sure that the right hon. Gentleman will agree that Cwmni Egino’s development model provides a blueprint, which could be used not just in Wales but beyond, for the alacrity of development that we are all seeking.

Tobias Ellwood: I am grateful for that intervention, which confirms that there is a desire to see these reactors built here in the UK. Initially they will all be built in a single factory, which, once it is up and running, will be able to build the components in months rather than decades. Just about all the moving parts are in place to make this happen: the design, the support from the Department for Business, Energy and Industrial Strategy—represented by the Minister who will respond to this debate—the initial development costs, the private sector investment and interest, and the factory in Derby that has been earmarked, along with potential sites across the country. We would be creating 40,000 jobs and £50 billion of investment, and offering a revolution in clean energy supply.
So what is the problem? If we have a workable design, a genuine solution to help resolve this energy challenge, a Government Department saying all the right things and offering support, and backing from the private sector, why did I need to bring this issue to the Floor of the House? The answer is very simple. The Rolls-Royce  design is now stuck between the development and delivery phases, and that delay means that the built-in advantage that Rolls-Royce has—its experience of procuring nuclear reactors for the Royal Navy—is being lost because of unnecessary delays and bureaucracy. Obviously all nuclear reactors are complex and there should be no short cuts to their procurement, but this is not about design approval; it is about the political will. The Government need to formally agree to commission those first five reactors here in the UK. That would allow Rolls-Royce to secure the funds to build the factory, and thus allow more reactor orders to be honoured.

Jamie Stone: Dounreay, in my constituency, was the site of the very first nuclear reactor built in the United Kingdom. The site is licensed, it has a very skilled workforce today, and it has huge local support. Does the right hon. Member agree that it should be considered as a site for one of these new reactors?

Tobias Ellwood: I would love to be the one who gifts these locations, and I would be grateful—I am sure the Minister is hearing this—if those five locations then received potential building permissions, but we need first to cut through the red tape that is stuck in the Government. I stress that the problem is not the Department represented here today; it is, I am afraid, the Treasury.

Virginia Crosbie: As chair of the all-party parliamentary group on small modular reactors, I thank my right hon. Friend for allowing me to intervene in this important debate.
Rolls-Royce SMR has secured funding of £210 million from UK Research and Innovation, and a further £280 million from private investors. We now need to move to the next stage, which is all about deployment. We need to agree with the UK Government on plans for siting and funding. Manufacturing plants have been earmarked for Rolls-Royce SMR across the UK, including Deeside, which will benefit north Wales and my constituents in particular. Does my right hon. Friend agree that the next stage is important because it will unlock more private sector investment and result in new factories and more high-skill jobs in the UK during this Parliament?

Tobias Ellwood: I am grateful to my hon. Friend for her intervention, and I commend her work in chairing the all-party parliamentary group. I hope that her comments will fall on the welcome ears of the Minister, who is soon to get to his feet.
My plea to the Minister is simple. I ask him please to recognise that the scale of the energy crisis we face necessitates a leaning into this project to secure the greater political alignment that would allow funding models to be completed during this Parliament. That is entirely possible.
Europe is once again at war, and it is time for us to move to a warlike footing if we are to reduce our dependence on overseas power sources which are exposed to volatile international prices and, indeed, adversarial interference which we cannot control. We can enjoy greater energy self-sufficiency with cheaper bills by generating cheap, clean, reliable power within our borders. We have the know-how, we have the desire, we have the industrial advantage; I simply ask the Minister for the political will to make it happen.

Nigel Evans: I welcome the Minister to his new role.

Graham Stuart: Thank you, Mr Deputy Speaker.
I want to begin by congratulating my right hon. Friend the Member for Bournemouth East (Mr Ellwood) on securing this important debate and speaking so passionately about the benefits that can come from this fascinating development of a UK capability in nuclear power. Tonight’s debate gives us the opportunity to build on the discussion on small modular reactors and energy security in the UK convened by my hon. Friend the Member for Ynys Môn (Virginia Crosbie) in January this year.
As Climate Minister I am proud to support not only the Government funding but the private investment that we are sometimes seeing facilitated by that Government funding in the nuclear sector. As my right hon. Friend the Member for Bournemouth East has said, the global energy crisis created by Russia’s invasion of Ukraine underlines our resolve to develop new nuclear capacity in order to boost our energy security. I am sure that all of us who take an interest in this will have been gladdened by the fact that there is such strong support for that across the House this evening.
As we make strides towards delivering net zero, the demands on our electricity system will increase. Electricity will be increasingly important, potentially providing around half of final energy demand as its use for heat and transport increases. That would require a fourfold increase in clean electricity generation, with the decarbonisation of electricity underpinning the delivery of that overall net zero target. Our analysis shows that all low-cost, low-emission solutions that will take us to this net zero-compliant electricity system are likely to require a combination of new nuclear, combined cycle gas turbines and carbon capture, utilisation and storage, in addition to growing levels of renewables. It is a complex piece, but we need all the bits to come together to meet the challenges that my right hon. Friend has set out.
Nuclear power is important for the UK’s energy security. As the world has emerged from covid-19, global demand for energy has risen significantly, and this has been exacerbated by Putin’s malign invasion of Ukraine. But secure, clean and affordable energy for the long term depends on the transformation of our energy system, and that means more home-grown energy from increasingly diverse sources in order to reduce our dependency on imported fossil fuels and our exposure to the high and volatile prices in international markets that we can see today.
Hon. Members will be aware that in April 2022 we announced the British energy security strategy. This  set out our ambition to deploy up to 24 GW of civil nuclear power by 2050, which will meet around 25% of our projected 2050 electricity demand. New nuclear generating capacity is an important part of our plans to ensure greater energy resilience as well as having a crucial role to play in net zero. I am delighted that the British energy security strategy set out the Government’s intention to take a large-scale new project to final investment decision during this Parliament, and that two projects will reach that point in the next Parliament, subject to the necessary approvals.
I remind Members that SMRs will play an important part, as well as those larger nuclear installations, and will be a critical part of delivering new nuclear for the  UK. They offer the opportunity for flexible deployment options—we have already heard various bids to host them—and could bring regional and socioeconomic benefits, including the creation of high-value manufacturing and engineering jobs on site and on the site of manufacture.
In November last year, as my right hon. Friend has said, we announced £210 million in match funding for Rolls-Royce SMR Ltd to develop the design for one of the world’s first small modular reactors. Funding for this project was predicated on Rolls-Royce matching the Government’s contribution with private investment, which has been found, giving the design the capability of being deployed in the UK by the early 2030s, if not before. The Government funding for Rolls-Royce is part of the advanced nuclear fund, which is a significant Government commitment of up to £385 million, both to develop domestic SMR design and to demonstrate the viability of innovative advanced modular reactors by the early 2030s.
In addition to investment in SMRs, the Government plan to invest in the AMR research, development and demonstration programme, which, as I say, should get something going by the early ’30s. It is focused on high-temperature gas reactors for low-carbon electricity generation and would allow the production of very high-temperature heat that could be used, for instance, for the increasingly efficient production of low-carbon hydrogen, to help to decarbonise industrial process heat, or even for synthetic fuel production.
I am pleased to remind Members that we launched the future nuclear enabling fund, or FNEF—I have realised, on my first day, that BEIS is full of acronyms galore—on 2 September 2022. The FNEF—they are never terribly well crafted—is a £120 million fund announced in the Government’s “Net Zero Strategy: Build Back Greener” in 2021. It aims to help mature potential nuclear projects ahead of any Government process to select future projects. We expect to make awards from the fund at the end of this year or at the start of 2023.
Alongside the launch of the FNEF, we are setting up Great British Nuclear, a body to enable nuclear projects and get us on a pathway to meeting our ambitions for new nuclear, with the aim of ensuring the kind of rapidity that my right hon. Friend is right to press for from Ministers such as me. We intend to initiate a selection process in 2023, with the intention that we will enter into negotiations with the most credible projects to enable a potential Government award of support as soon as possible.
I was pleased that Parliament backed the Nuclear Energy (Financing) Act 2022, which was granted Royal Assent in March and established a new regulated asset base—or RAB—funding model for all new nuclear projects.

Tobias Ellwood: I hope my hon. Friend will forgive me for not having congratulated him on securing his new position. He is a round peg in a round hole; I know how passionate he is about the environment. Will he join me in paying tribute to my right hon. Friend the Member for Spelthorne (Kwasi Kwarteng), who was previously in charge at BEIS? He is now in the Treasury and therefore perfectly placed to advance this idea. During  the war there was an effort to create munitions, and we leant into that project because there was a necessity, and during covid there was a necessity to create personal protective equipment. Does my hon. Friend agree that there is now a necessity for us to lean into this idea and expedite it—within the safety parameters—to make sure that we can become more energy resilient?

Graham Stuart: I thank my right hon. Friend, and I am happy to do that. He will forgive me, perhaps on this one day only, for not leaning in to chastise any other Department or the Government in general on day one, self-confident though I always try to be. If we look at what we have done, we see that we have reduced our emissions by more than any other major industrialised nation, and offshore wind has been a triumph.
I am looking forward to learning more about the detail of these programmes, but I have no doubt that with the right will and the proper prompting by colleagues from across the House we can ensure that we move with the speed necessary. We need to, because as he rightly says, we are not alone in pursuing and seeing this opportunity, and there have been instances in the past when this country has been in a position to lead and has not moved quickly enough, and multibillion-dollar opportunities—let us call them that—have ended up going elsewhere.
I am determined that we shall not only deliver on our green obligations in this country, but build our industrial capability so that even the most sceptical person comes on board as we say, “Look, we are not just dealing with climate and not just cleaning up our domestic situation. We are developing major industrial capability so that we can sell that to the rest of the world, help it with the net zero challenge, and also produce jobs and prosperity here.” It is not a hairshirt that we want; we want to get the policy right so that we are part of a global solution, and to do so in a way that boosts jobs and prosperity and carries the support of everyone, regardless of their views on climate-related matters.
We believe that the RAB could cut the costs of financing these projects, enabling companies to finance new ones and ending our reliance on overseas developers for finance, resulting in savings for consumers. On day one, I can reassure my right hon. Friend that a lot of work is going into making sure not only that we can move at pace, but that we do so with the most solid base possible.
We fully support the development of small modular reactors and the exciting opportunities that they can offer the UK in energy security and reaching net zero. We have demonstrated our intent to build new nuclear capacity in the UK over the past year, and we have made the decisions that we believe will provide the confidence needed for investors and businesses to get behind it. From the energy White Paper to our landmark British energy security strategy to funding for small modular reactors and the future nuclear enabling fund, I hope we have shown our dedication to energy security, net zero and nuclear. I thank my right hon. Friend and other colleagues once again.
Question put and agreed to.
House adjourned.